Question

Is Action 5 inappropriate?

A. Internal control should be evaluated on every engagement, but the internal control questionnaire is not the mandated approach to evaluate the controls.
B. Internal control should be evaluated on every engagement, and the internal control questionnaire is the most efficient method to do so.
C. Internal auditors may omit necessary procedures if there is a time constraint. It is a matter of professional judgment.
D. Internal auditors are not required to fill out internal control questionnaires on every engagement.

Answer 1

The correct answer to whether Action 5 is inappropriate is Option A: Internal control should be evaluated on every engagement, but the internal control questionnaire is not a mandated approach. Auditors are permitted to use other methods based on professional judgment.

Step-by-step explanation:

The subject of the question is internal control evaluation within the context of auditing. When considering whether Action 5 is inappropriate, we should examine the best practices for evaluating internal controls during an audit engagement. Option A is correct; internal control should indeed be evaluated on every engagement, but there is no mandate stating that an internal control questionnaire must be used for this evaluation.

Using such a questionnaire is one approach, but auditors are allowed to use other methods that they find to be more suitable or efficient based on professional judgment and the specific circumstances of the engagement. Options B, C, and D contain inaccuracies regarding the need to use a specific method for evaluating internal controls or suggesting that auditors can omit necessary procedures due to time constraints, which is not a practice aligned with professional standards.