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Explain importance of test of control in the statutory audit of any corporation ?

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Question added by Frank Mwansa , ACCOUNTING LECTURER , FREELANCER
Date Posted: 2022/05/16
Frank Mwansa
by Frank Mwansa , ACCOUNTING LECTURER , FREELANCER

  A test of control involves testing the operating effectiveness of controls in avoiding, discovering or correcting material misstatements. It is very important for the external auditor to test controls to make sure initial understanding obtained when assessing the control environment and internal controls is okay.

This will allow the auditor to identify an assess the risks of material misstatements in the financial statements and to determine to what extent to rely on the internal control systems during the audits.

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