The study of the client's internal control by the auditor is:
A) recommended by the Corporations Act.
B) required by auditing standards.
C) required by accounting standards.
D) required by the ASX for listed companies.

Question

Quizplus · Accepted Answer

The study of the client's internal control by the auditor is required by auditing standards, specifically Auditing Standard ASA 315 (Revised), which requires the auditor to obtain an understanding of the entity's internal control relevant to the audit in order to assess the risk of material misstatement. The other options listed do not specifically require the study of internal control by the auditor.

The Study of the Client's Internal Control by the Auditor