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If the auditor wants to rely upon a control and so tests that control, what should...

If the auditor wants to rely upon a control and so tests that control, what should the auditor do if the control is found not to be working effectively?

a.Perform reduced direct tests of account balances.

b.Perform extensive direct tests of account balances.

c.Perform the same level of direct tests of account balances.

d.Reperform the test of controls.

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Answer #1

The correct answer is Option B

If the auditor wants to rely upon a control and so tests that control, the auditor should Perform extensive direct tests of account balances if the control is found not to be working effectively.

In such a case an auditor cannot rely on the controls and will have to perform extensive tests of accounts. The auditors will enhance the use of substantive testing.

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