If the auditor's expectations regarding effective controls are not confirmed, ________.
A)the auditor should proceed with testing of controls
B)the auditor will need to evaluate the significance of the weaknesses noted and determine if the client has a compensating control in place that the auditor might rely on.
C)the auditor will need to evaluate the significance of the weaknesses noted and simply document this
D)the auditor should withdraw from the engagement

Question

Quizplus · Accepted Answer

If the auditor's expectations regarding effective controls are not confirmed, the auditor will need to evaluate the significance of the weaknesses noted and determine if the client has a compensating control in place that the auditor might rely on. The auditor should proceed with testing of controls to determine if the controls are actually functioning as designed. If weaknesses are found, the auditor will need to evaluate their significance and determine if they are material enough to affect the financial statements. If compensating controls are in place, the auditor might be able to rely on them and still issue an unqualified opinion.

If the Auditor's Expectations Regarding Effective Controls Are Not Confirmed