If the controls in the long-term debt and owner's equity process are not designed appropriately or are not operating properly,the auditor will

Question

Quizplus · Accepted Answer

If the controls in the long-term debt and owner's equity process are not designed appropriately or are not operating properly, the auditor will need to design substantive tests to determine whether the internal control failures have led to misstatements in the financial statement accounts. This will allow the auditor to identify and correct any errors or inaccuracies in the financial statements, ensuring that the information provided is accurate and reliable. Control tests may also be performed to evaluate the effectiveness of the internal controls and identify areas for improvement. However, the primary focus will be on designing tests to detect any misstatements caused by internal control failures.

If the Controls in the Long-Term Debt and Owner's Equity