An auditor wishes to perform tests of controls on a client's cash disbursements procedures. If the controls leave no audit trail of documentary evidence, the auditor most likely will test the procedures by:

Question

Quizplus · Accepted Answer

Choice "B" is correct. For internal controls which leave no audit trail of documentary evidence (e.g., segregation of duties), the auditor must use inquiry and observation to test the procedures. Choice "A" is incorrect. Confirmation is a substantive audit procedure not appropriate for tests of controls. Choice "C" is incorrect. Analytical procedures and confirmation are substantive audit procedures not appropriate for tests of controls. Choice "D" is incorrect. Analytical procedures are substantive audit procedures not appropriate for tests of controls.

An Auditor Wishes to Perform Tests of Controls on a Client's