Which of the Following Statements Is Correct Concerning the Understanding

question 62

Multiple Choice

Which of the following statements is correct concerning the understanding of internal control needed by auditors?

• A)The auditors must understand the information system,not the accounting system.
• B)The auditors must understand monitoring and all preliminary accounting controls.
• C)The auditors must have a sufficient understanding to assess the risks of material misstatement.
• D)The auditors must understand the control environment,risk assessment,and all control activities.

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Definitions:

Decision Making

The process of choosing between alternatives to reach a conclusion or strategy.

Implementing Solution

Implementing a solution involves the practical application of strategies and plans to solve a problem, including the coordination of resources and the management of tasks.

Evaluating Results

The process of analyzing outcomes to assess the effectiveness of actions taken and inform future decisions.

Implementation Stage

The phase in a project or plan when the designed strategies or actions are put into operation or execution.