In addition to the audit of financial statements, it is also the responsibility of the auditor to establish and maintain internal controls that are effective in preventing and detecting material misstatements. Group of answer choices True False
Question
In addition to the audit of financial statements, it is also the responsibility of the auditor to establish and maintain internal controls that are effective in preventing and detecting material misstatements.
Group of answer choices
True
False
Solution
False
While auditors do assess the effectiveness of a company's internal controls as part of their audit, it is not their responsibility to establish and maintain these controls. That responsibility lies with the company's management. The auditor's role is to evaluate the design and operation of those controls in preventing and detecting material misstatements in the financial statements. Therefore, the statement is false.
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