Larger audits may have established procedures that utilize an audit committee whenever there is a dispute between management and the auditors.What is the purpose of such procedures?
A)to ensure that the auditor understands management's point of view
B)to improve the competence of the financial statement auditors
C)to facilitate the auditors' independence from management
D)to help make sure the audit is conducted following GAAS

Question

Quizplus · Accepted Answer

The purpose of utilizing an audit committee whenever there is a dispute between management and the auditors is to facilitate the auditors' independence from management. An audit committee can act as an intermediary to help resolve any disagreements and ensure the auditor's objectivity and impartiality in conducting the audit. This is important to maintain the integrity and reliability of the audit process, as well as to enhance the credibility of the financial statements. A and D are not correct choices because the purpose of the procedure is not just to ensure that the auditors understand management's point of view or to help make sure the audit is conducted following GAAS. B is also not a correct choice as the procedure is not primarily aimed to improve the competence of the financial statement auditors.

Larger Audits May Have Established Procedures That Utilize an Audit