Reports on service organizations typically:
A)provide reasonable assurance that their financial statements are free of material misstatements.
B)ensure that the entity will not have any misstatements in areas related to the service organization's activities.
C)ensure that the auditee is billed correctly.
D)assess whether the service organization's controls are suitably designed to achieve internal control objectives.

Question

Quizplus · Accepted Answer

Reports on service organizations typically assess whether the service organization's controls are suitably designed to achieve internal control objectives. This evaluation is done through a review of the service organization's control framework and testing of controls that are relevant to the auditee. The report does not provide assurance on billing accuracy or financial statement misstatements of the auditee.

Reports on Service Organizations Typically