The purpose of tests of controls is to provide reasonable assurance that the:
A) entity has complied with requirements of quality control.
B) accounting treatment of transactions and balances is valid and proper.
C) entity has complied with disclosure requirements of generally accepted accounting principles.
D) accounting control procedures are operating effectively.

Question

Quizplus · Accepted Answer

Tests of controls are designed to evaluate the effectiveness of accounting control procedures to ensure they are operating correctly. These tests help auditors determine whether the financial statements are fairly presented and whether the auditor can place reliance on internal controls. Therefore, the best choice is D, which focuses on testing the effectiveness of control procedures. Choices A, B, and C are not directly related to tests of controls.

The Purpose of Tests of Controls Is to Provide Reasonable