When an Auditor Chooses Not to Rely on a Client's

question 11

Multiple Choice

When an auditor chooses not to rely on a client's internal controls because the control design is ineffective,which of the following tests are eliminated?

• A)Substantive testing.
• B)Tests of controls.
• C)Tests of details of balances.
• D)Substantive analytical procedures.

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Definitions:

Job Cost Accuracy

The precision with which the actual costs of a particular job or project match the estimated costs.

Overhead Rates

A measure used to allocate manufacturing overhead costs to produced units, often based on direct labor hours or machine hours.

Overhead Cost Driver

A factor that influences or contributes to the overhead costs of a business.

Employee Time Ticket

A document that records the amount of time an employee spends on various tasks, used for payroll and accounting purposes.