Megan Matthews ACCT470-V2WW February 20, 2012 Assignment 8-3 Internal Control Tools and Techniques 6-28. Auditors use various tools to document their understanding of an entity’s internal control system, including narrative descriptions, internal control questionnaires, and flow charts. a. Identify the relative strengths of each tool. 1. Procedures Manuals and Organizational Charts: help the auditor document understanding of the internal control system. 2. Internal Control Questionnaires: provides a systematic and comprehensive way to evaluate internal control. 3. Flowcharts: provides a diagrammatic representation of the entity’s internal control system. This facilitates the auditor's analysis of the system’s controls. 4. Narrative Description: provide a simple, written memorandum that documents the understanding of internal control. (p. 202) b. Briefly describe how the complexity of an entity’s internal control system affects the use of various tools. On many engagements, auditors combine these tools to document their understanding of the
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