When an Auditor Sets Control Risk Low, Sufficient Evidence Can

question 11

Essay

When an auditor sets control risk low, sufficient evidence can be obtained for most payroll accounts through an understanding of internal controls, substantive analytical procedures, and tests of details of transactions. However, there are several accounts in the payroll cycle that may require more attention. Name the accounts and explain why the additional testing is necessary.

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Definitions:

Illogical Reasoning

A form of reasoning where conclusions are drawn or arguments made that do not follow logically from the premises or evidence provided.

Qualitative

Pertaining to or concerning the quality or nature of something, often used in research to describe non-numerical data gathered through observation, interviews, and narratives.

Quantitative

Pertaining to or involving the measurement of quantity or amount. In research, it refers to methods that focus on numbers and statistical analysis.

Deduction

A logical process in which a conclusion follows necessarily from the set of premises, moving from general principle to a specific instance.