Area III: Performing Procedures — CPA Practice Question 28

How to approach this question

Single Audit Rule: You MUST test controls for major programs. You must plan for LOW control risk.

Full Answer

B.The auditor must plan to obtain a low level of control risk for compliance controls.✓ Correct

The auditor must plan to obtain a low level of control risk for compliance controls.

Unlike a standard financial statement audit where the auditor can choose a 'substantive only' approach, the Uniform Guidance mandates that for Major Programs, the auditor MUST perform tests of controls to support a low assessed level of control risk.

Common mistakes

Applying financial audit logic (optional control testing) to Single Audits.

An auditor is performing a Single Audit under the Uniform Guidance (2 CFR 200). The auditor has identified a 'major program' to test. Which of the following determines the auditor's testing strategy for internal controls over compliance for this major program?

How to approach this question

Full Answer

Common mistakes

Practice the full CPA AUD Practice Exam 4

More questions from this exam