“Internal control questionnaire is a method to collect information about the existence, operation and efficiency of internal control in an organization” Discuss.

Auditing and Assurance Revision Questions and Answers

advantage of the questionnaire approach is that oversight or omission of significant internal control review procedures is likely to occur with this method. With a proper questionnaire, all internal control evaluation can be completed at one time or in sections. The review can more easily be made on an interim basis. The questionnaire form also provides an orderly means of disclosing control defects. In the questionnaire, generally questions are so framed that ‘Yes’ answer denotes satisfactory position and a ‘No’ answer suggests weakness. Provision is made for an explanation or further details of ‘No’ answer. In respect of questions not relevant to the business, ‘Not Applicable’ reply is given.
The questionnaire is usually issued to the client and the client is requested to get it filled by the concerned executives and employees. If on a perusal of the answer, inconsistencies or apparent incongruities are noticed, the matter is further discussed by auditor’s staff with the client’s employees for a clear picture. The concerned auditor then prepares a report of deficiencies and recommendations for improvements.
Internal control questionnaire hence facilitates the audit process as a clear picture of the relevant control weaknesses are traced out immediately which facilitates the entire audit planning as the critical audit areas are readily identified.

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