Internal control reporting must be based on evidence of both the design and the operation of internal controls.

Question

Quizplus · Accepted Answer

Internal control reporting should be based on evidence of the design of the internal controls, as well as evidence of their operation. This includes documentation, process flows, and interviews with employees to assess the effectiveness of the controls in place. Without evidence of both the design and operation of internal controls, it is difficult to accurately report on their efficiency and effectiveness.

Internal Control Reporting Must Be Based on Evidence of Both