At a Minimum,in Order to Comply with PCAOB AS 5,an

question 46

Multiple Choice

At a minimum,in order to comply with PCAOB AS 5,an auditor of a public company that has material transactions processed by a service organization would have to request from the service organization

• A) a description of its internal controls.
• B) a type one service auditors' report.
• C) a type two service auditors' report.
• D) a Service Organization Control (SOC) 3 report.

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Definitions:

Centralization

The concentration of control and decision-making authority in a centralized location or group within an organization.

Authority

The capacity to direct, adjudicate, and ensure observance.

Consistency

The quality of achieving a level of performance or behavior that does not vary greatly in quality over time.

Organization Design

The planning and structuring of an organization's framework and systems to align with its goals and strategy, optimizing its operational efficiency.