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:

Overlearned Information

Knowledge or skills that have been practiced beyond the point of initial mastery, making them automatic.

Levels-Of-Processing

A theory of memory suggesting that memory recall is influenced by the depth of mental processing, which ranges from shallow to deep levels.

Modal Memory Store

A concept in memory research referring to different types of memory storage, such as short-term, long-term, and sensory memory.

Anterograde Amnesia

A condition in which new memories cannot be formed following a traumatic event or injury to the brain.