An Auditor Is Examining a Nonpublic Company's Inventory Procurement System

question 80

Multiple Choice

An auditor is examining a nonpublic company's inventory procurement system and has decided to perform tests of controls. Under which of the following conditions should the auditor perform tests of controls?

• A)Significant weaknesses were found in the company's internal control.
• B)The auditor hopes to reduce the amount of work to be done in assessing inherent risk.
• C)The auditor believes that testing the controls could lead to a reduction in overall audit time and cost.
• D)Tests of controls are always performed when the auditor begins to assess control risk.

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