'Dual-purpose tests' involve:
A)tests of controls that address both the design of the control procedures and their operating effectiveness.
B)tests of transactions that include substantive procedures as well as tests of controls.
C)tests that address both balances and transaction classes.
D)tests performed because of client expectations as well as for gathering audit evidence.

Question

Quizplus · Accepted Answer

Dual-purpose tests involve testing transactions for both the presence of control activities (tests of controls) as well as the monetary correctness of the transactions (substantive procedures). This approach helps to save time and resources while providing a higher level of assurance. Option A is incorrect because it only tests the design and effectiveness of controls, not transactions. Option C is incorrect because it deals only with balances and not transactions. Option D is incorrect because client expectations should not drive the audit procedures; they should be based on audit objectives and risk assessments.

'Dual-Purpose Tests' Involve