Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented. The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

Question

Want to see the full answer?

Answer 1

Question

Chapter 6, Problem 6.27P

a

To determine

Introduction:

Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

b

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors should be considered if the auditor is considering to engage an IT specialist, the information required to be asked to the specialist to provide.

c

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The effect on components of the entity’s internal control when the entity changes to an IT-based accounting system.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

An S corporation earns 59.10 per share before taxes. The corporate tax rate is 39%, the personal tax rate on dividends is 15%, and the personal tax rate on non-dividend income is 36%. What is the total amount of earnings after - taxes? a. $3.28 b. $3.93 c. $2.62 d. $4.59

You want to buy a new sports car from Muscle Motors for $36,000. The contract is in the form of an annuity due for 60 months at an APR of 8.00 percent. What will your monthly payment be?

Use the following information to answer this question: Net sales Windswept, Incorporated 2024 Income Statement Cost of goods sold Depreciation ($ in millions) Earnings before interest and taxes Interest paid Taxable income Taxes Net income $ 14,150 8,150 515 $ 5,485 108 $ 5,377 1,129 $ 4,248 Windswept, Incorporated 2023 and 2024 Balance Sheets ($ in millions) 2023 2024 2023 2024 Cash Accounts received $ 300 $ 330 Accounts payable $ 1,980 $1,955 1,190 1,090 Long-term debt 1,110 1,430 Inventory 2,120 1,795 Common stock 3,440 3,080 Total $ 3,610 $ 3,215 Retained earnings 690 940 Net fixed assets 3,610 Total assets $ 7,220 4,190 $ 7,405 Total liabilities & equity $ 7,220 $ 7,405 What is the fixed asset turnover for 2024?

Answer 2

Question

Chapter 6, Problem 6.27P

a

To determine

Introduction:

Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

b

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors should be considered if the auditor is considering to engage an IT specialist, the information required to be asked to the specialist to provide.

c

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The effect on components of the entity’s internal control when the entity changes to an IT-based accounting system.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 6, Problem 6.27P

a

To determine

Introduction:

Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

b

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors should be considered if the auditor is considering to engage an IT specialist, the information required to be asked to the specialist to provide.

c

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The effect on components of the entity’s internal control when the entity changes to an IT-based accounting system.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 6, Problem 6.27P

a

To determine

Introduction:

Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

b

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors should be considered if the auditor is considering to engage an IT specialist, the information required to be asked to the specialist to provide.

c

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The effect on components of the entity’s internal control when the entity changes to an IT-based accounting system.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 6, Problem 6.27P

a

To determine

Introduction:

Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

b

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors should be considered if the auditor is considering to engage an IT specialist, the information required to be asked to the specialist to provide.

c

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The effect on components of the entity’s internal control when the entity changes to an IT-based accounting system.

Answer 6

Chapter 6, Problem 6.27P

a

To determine

Introduction:

Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

Answer 7

Chapter 6, Problem 6.27P

a

To determine

Introduction:

Substantive strategy: In this, the auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence, when the entity has changed its accounting system.

Answer 8

b

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors should be considered if the auditor is considering to engage an IT specialist, the information required to be asked to the specialist to provide.

Answer 9

b

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The factors should be considered if the auditor is considering to engage an IT specialist, the information required to be asked to the specialist to provide.

Answer 10

c

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The effect on components of the entity’s internal control when the entity changes to an IT-based accounting system.

Answer 11

c

To determine

Introduction:

Substantive strategy: In this, auditor does not rely on the entity’s internal controls instead depends on substantive procedures for evidence about the claims in the financial statements. The auditor requires minimum knowledge of the organization’s internal controls and the five components of internal control for this strategy to see if it is properly implemented.

The effect on components of the entity’s internal control when the entity changes to an IT-based accounting system.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 15

Ch. 6 - Prob. 6.1RQ Ch. 6 - Prob. 6.2RQ Ch. 6 - Prob. 6.3RQ Ch. 6 - Prob. 6.4RQ Ch. 6 - Prob. 6.5RQ Ch. 6 - Prob. 6.6RQ Ch. 6 - Prob. 6.7RQ Ch. 6 - Prob. 6.8RQ Ch. 6 - Prob. 6.9RQ Ch. 6 - Prob. 6.10RQ

Solution Summary: The author analyzes the factors that should be considered when deciding whether to move to a reliance strategy of sourcing audit evidence.

Want to see the full answer?

Chapter 6 Solutions