At a minimum,in order to comply with PCAOB AS 5,an auditor of a public company that has material transactions processed by a service organization would have to request from the service organization
A) a description of its internal controls.
B) a type one service auditors' report.
C) a type two service auditors' report.
D) a Service Organization Control (SOC) 3 report.

Question

Quizplus · Accepted Answer

According to PCAOB AS 5, an auditor of a public company that has material transactions processed by a service organization needs to perform an audit of the controls at the service organization. The auditor should request a type two service auditors' report, which provides an opinion on the effectiveness of the controls at the service organization over a period of time. This report provides the auditor with the necessary information to evaluate the service organization's internal controls and to determine whether to rely on those controls in the audit of the public company's financial statements. The other options, such as a description of internal controls or a SOC 3 report, may provide some information, but they do not provide the necessary level of assurance regarding the effectiveness of the controls at the service organization.

At a Minimum,in Order to Comply with PCAOB AS 5,an