Question

When testing a computerized accounting system, which of the following is false regarding the test data approach?

A) The test data need to consist of only those valid and invalid conditions in which the auditor is interested.

B) Only one transaction of each type needs be tested.

C) Test data are processed by the entity's computer programs under the auditor's control.

D) The test data must consist of all possible valid and invalid conditions.

Answer 1

The false statement regarding the test data approach in testing a computerized accounting system is that only one transaction of each type needs to be tested.

Step-by-step explanation:

The false statement regarding the test data approach in testing a computerized accounting system is B) Only one transaction of each type needs be tested.

In the test data approach, the test data need to consist of both valid and invalid conditions in which the auditor is interested (option A). It is important to test a sufficient number of transactions to evaluate the effectiveness and accuracy of the system. This means that more than one transaction of each type should be tested (option B). The test data is processed by the entity's computer programs under the auditor's control, so option C is true. Lastly, the test data does not need to consist of all possible valid and invalid conditions, as this would be impractical and unnecessary (option D).