It is important for the CPA to consider the competence of the entity's employees because their competence bears directly and importantly upon the:
A)cost/benefit relationship of the system of internal control.
B)achievement of the objectives of the system of internal control.
C)comparison of recorded accountability with assets.
D)timing of the tests to be performed.

Question

Quizplus · Accepted Answer

The competence of the entity's employees is important because it directly affects the achievement of the objectives of the system of internal control. The system of internal control is designed to ensure that the entity's objectives are achieved, and competent employees are necessary to effectively implement and maintain the system. If employees lack competence, they may not properly carry out their responsibilities, which may result in the system not achieving its objectives. Therefore, the CPA must consider the competence of the entity's employees when assessing the effectiveness of the system of internal control.

It Is Important for the CPA to Consider the Competence