Week 8 - Types of Audit Test

Question 1

What are the two types of audit test?

Answer 1

• substantive
• compliance

Question 2

Compliance test

Answer 2

Test that they key controls over a process are operating effectively

Question 3

Substantive test

Answer 3

Must always do. Includes
- substantive analytical procedures (comparing to prior years/ similar companies / what you expected)
- tests of details

Question 4

Example of compliance testing

Answer 4

Inspect a sample of supplier statement reconciliations for evidence that they have been reviewed by management

Question 5

Example of substantive testing

Answer 5

Inspect the cash book payment post-year-end for any significant payments to suppliers to ensure that the year end liability has been accurately recorded