Auditors test the ICFR by reviewing the receiving process.

Question

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Auditors test the ICFR by reviewing various processes such as receiving, purchasing, inventory management, and financial reporting processes. The receiving process includes the acceptance of goods and services, verification of the quantity and quality of goods received, and timely recording of the receipt in the books of accounts. Reviewing the receiving process helps auditors to assess the effectiveness of internal controls in ensuring that goods and services received are accurate, authorized, and properly recorded in the financial statements.

Auditors Test the ICFR by Reviewing the Receiving Process