ExpertMedium1 markMultiple Choice
CPA · Question 63 · Area III: SOC Engagements
Which of the following is a 'Type 1' SOC report?
Which of the following is a 'Type 1' SOC report?
Answer options:
A.
Report on the fairness of the presentation and the suitability of the design and operating effectiveness of controls over a period of time.
B.
Report on the fairness of the presentation and the suitability of the design of controls at a specific point in time.
C.
Report on the financial statements.
D.
Report for general public use.
How to approach this question
Type 1 = Snapshot (Design only). Type 2 = Movie (Design + Operation over time).
Full Answer
B.Report on the fairness of the presentation and the suitability of the design of controls at a specific point in time.✓ Correct
B
A Type 1 report looks at the design of controls at a specific point in time (e.g., as of Dec 31). It does not test whether the controls operated effectively over a period (that is Type 2).
Common mistakes
Confusing Type 1 (Design/Point in time) with Type 2 (Operating Effectiveness/Period).
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