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Exam AUD topic 1 question 936 discussion

Actual exam question from AICPA's AUD
Question #: 936
Topic #: 1
[All AUD Questions]

Which of the following statements describes an auditor's obligation to identify deficiencies in the design or operation of internal control?

  • A. The auditor should design and apply tests of controls to discover significant deficiencies in internal control that could result in material misstatements.
  • B. The auditor need not search for significant deficiencies in internal control unless management requests an attestation that "no significant deficiencies in internal control were noted in the audit."
  • C. The auditor should search for significant deficiencies in internal control if the auditor expects that controls are operating effectively (i.e., if the auditor plans to rely on controls).
  • D. The auditor need not search for significant deficiencies in internal control but should document and communicate any such deficiencies that are discovered.
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Suggested Answer: D 🗳️
Choice "D" is correct. The auditor need not search for significant deficiencies in internal control, but should document and communicate any such deficiencies that are discovered.
Choice "A" is incorrect. Tests of controls are designed and applied to evaluate the risk of financial statement misstatement, and to determine the nature, timing, and extent of substantive tests to be performed. They are not designed to discover significant deficiencies in internal control.
Choice "B" is incorrect. Searching for significant deficiencies in internal control is not part of an audit, and it would be inappropriate for the auditor to state that no significant deficiencies in internal control were noted (even if management requested such a statement).
Choice "C" is incorrect. Searching for significant deficiencies in internal control is not part of an audit even if the auditor expects that controls are operating effectively (i.e., expects to rely on controls).
by gemazyni at April 5, 2025, 5:19 p.m.

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