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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › Question Help
Hi Sir,
I need some help with a question. I couldn’t fully find information that explains how and why the external auditor will try to rely on internal controls wherever possible when carrying out their audit and the implications for the audit if the auditor concludes that controls are not operating effectively?
Your help will be greatly appreciated.
Richard
Wanted to add the question is for 4 marks.
If IC can be relied upon then the audit can be performed juch more efficiently than having to use substantive tests on their own. The volume of testinf needed is much lower.
If IC cannot be relied upon, then the only source of evidence is substantive testing, which usually means high volume testing of transactions.
This is covered in Chapter 8nof our notes and lectures.