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NEW QUESTION: 1
An auditor's primary consideration regarding an entity's internal control is whether the controls:
A. Reflect management's philosophy and operating style.
B. Relate to the control environment.
C. Affect the financial statement assertions.
D. Prevent management override.
Answer: C
Explanation:
Explanation/Reference:
Explanation:
Choice "A" is correct. An auditor's primary consideration regarding an entity's internal control is whether
the controls affect the financial statement assertions (to evaluate the risk that a material misstatement may
exist in the financial statements).
Choice "B" is incorrect. An inherent limitation of an entity's internal control is that its effectiveness can be
reduced by management override, but whether this occurs or not is not the auditor's primary
consideration.
Choice "C" is incorrect. The control environment is a component of internal control, and the auditor needs
to understand it, but it is not the auditor's primary consideration.
Choice "D" is incorrect. An auditor needs to determine how management's philosophy and operating style
affect internal control, but it is not the auditor's primary consideration.
NEW QUESTION: 2
A. Option D
B. Option B
C. Option A
D. Option C
Answer: A
NEW QUESTION: 3
Which is NOT a purpose of the Process Reference Model?
A. Provides the basis to undertake an assessment on the process dimension
B. Forms the basis of a process capability assessment for the Capability Dimension
C. Provides the mechanism whereby defined Process Assessment Models ire related to the measurement framework
D. Provides the basis for one or more Process Assessment Models
Answer: B