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12 2RQ
12 2RQ
12 2RQ
<TO-DETERMINE>
Identify whether the approach of CPA JM is correct while auditing the financial
statement of the company.
</TO-DETERMINE>
<EXPLANATION>
CPA JM is correct by believing that the internal control system does not work in a
manner it should work. But the JM lacks where it is believed that it is not required to
obtain understanding of internal control till the end of engagement. The person by not
considering the importance of obtaining the understanding of internal control till the
engagement is taking risk which may lead to inappropriate financial audit.
</EXPLANATION>