Inquiry is a valuable technique during the planning phase of the audit because it
A)involves the rechecking of controls to ensure that they are conducted accurately.
B)is a type of audit evidence that provides a very high level of assurance.
C)is conclusive evidence from an independent source.
D)helps obtain information about how procedures and internal controls operate.

Question

Quizplus · Accepted Answer

Inquiry is a technique of obtaining information from management or key personnel about how procedures and internal controls operate. This helps the auditor gain an understanding of the entity's processes and controls, which is essential during the planning phase of the audit. However, inquiry alone is not sufficient audit evidence and must be supplemented with other techniques to obtain reasonable assurance.

Inquiry Is a Valuable Technique During the Planning Phase of the Audit