Compensating controls
A)occur before the transaction is complete.
B)are controls used by auditors to offset the risk in another procedure.
C)are used because it is cost effective to implement particular control procedures.
D)to be effective,will likely detect misstatements in a timely fashion.

Question

Quizplus · Accepted Answer

Compensating controls are designed to detect misstatements in a timely fashion, in order to offset the risk of inadequate controls. These controls are used when other control procedures are either too costly or cannot be implemented for some reason. They offer a secondary line of defense against errors or fraud, and are often used by auditors to mitigate the risk of material misstatements.

Compensating Controls