Which of the following strategies will a CPA most likely consider in auditing an entity that processes most of its financial data only in electronic form,such as a paperless system?
A)Continuous monitoring and analysis of transaction processing with an embedded audit module.
B)Increased reliance on internal control activities that emphasize the segregation of duties.
C)Verification of encrypted digital certificates used to monitor the authorization of transactions.
D)Extensive testing of firewall boundaries that restrict the recording of outside network traffic.

Question

Quizplus · Accepted Answer

With the entity processing most of its financial data only in electronic form, a CPA would likely consider using continuous monitoring and analysis of transaction processing with an embedded audit module. This strategy would provide the CPA with real-time information, allowing for ongoing risk assessment and timely detection of potential issues. Additionally, since a paperless system can be more vulnerable to fraud or errors, this strategy can help to identify these anomalies early on.

Which of the Following Strategies Will a CPA Most Likely