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To Perform an Audit, It Is Necessary for the Information

question 33

Essay

To perform an audit, it is necessary for the information to be in a verifiable form and there must be some criteria by which the auditor can evaluate the information. Detail the information and criteria that would be used when
(A) an independent CPA firm audits a company's historical financial statements.
(B) an Internal Revenue Service auditor audits that same company's tax return.
(C) an internal auditor performs an operational audit to evaluate whether the company's computerized payroll processing system is operating efficiently and effectively.


Definitions:

P-value

The probability of obtaining test results at least as extreme as the ones observed during the test, assuming that the null hypothesis is true.

Level of Significance

The probability of rejecting the null hypothesis in a statistical test when it is true, often denoted by alpha.

One-tailed

Describes tests or confidence intervals that focus on one direction of effect or relationship, either greater than or less than a certain value.

Null Hypothesis

A statement in hypothesis testing that assumes no significant difference or effect exists between certain populations or variables.

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