How can the audit team assess the operating effectiveness of controls?
The audit team must assess whether the controls that management has designed and implemented are actually effective. The auditor should also determine whether the person(s) implementing the internal controls are qualified to do the job.
The visual below lists out the ways to assess the operating effectiveness of internal controls:
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How can the audit team assess the design of internal controls?
The audit team is required to assess the design of the internal controls that management has implemented. The audit team should assess whether or not the design will prevent or detect and correct material misstatements. The visual below lists out the different ways an audit team can assess the design of internal controls:
What is an integrated audit?
An integrated audit is when the audit firm must express an opinion the fair presentation of a company’s financial statements and the design and operating effectiveness of a company’s internal controls. Rule 404 is commonly associated with an integrated audit as rule 404 relates to an audit over a company’s internal controls. Public companies that […]