Under the Sarbanes-Oxley Act, the auditor's responsibility with respect to internal controls can best be stated as:
A)Develop a system of internal controls that helps to prevent and detect fraud
B)Assess whether the internal controls helps to prevent and detect fraud
C)Assess management's report on internal controls
D)All of the above

Question

Quizplus · Accepted Answer

Under the Sarbanes-Oxley Act, the auditor's responsibility with respect to internal controls is to assess management's report on internal controls. The auditor evaluates the effectiveness of internal control over financial reporting and expresses an opinion on the fair presentation of the financial statements. The auditor is not responsible for developing a system of internal controls, but rather assessing the adequacy of the system already in place. The auditor is also not responsible for preventing or detecting fraud, but rather assessing the controls in place to prevent and detect fraud. Therefore, option A is incorrect. Option B is partially correct as the auditor assesses whether internal controls are effective in preventing and detecting fraud, but it is not the auditor's primary responsibility.

Under the Sarbanes-Oxley Act, the Auditor's Responsibility with Respect to Internal