Which of the following would most likely form part of the engagement scope?
A.
Potential legislation on privacy topics will be employed as a compliance target O Wire transfers that exceeded $10,000 in the last 12 months will be analyzed.
B.
Both random and judgmental samplings will be used during the engagement
C.
The probability of significant errors will be considered via risk assessment.
The engagement scope outlines the boundaries of the audit activities, specifying the methods and techniques to be employed during the engagement.
Scope Definition:
The scope includes the areas to be reviewed, the nature and extent of testing, and the specific objectives and criteria to be used.
Options Analysis:
Option A: Specifying compliance targets is part of planning but too specific for the overall engagement scope.
Option B: Detailing the use of both random and judgmental samplings defines the methodology clearly, which is appropriate for the engagement scope.
Option C: Considering the probability of significant errors is part of the risk assessment process, not the scope itself.
Option D: Analyzing wire transfers is a specific audit test rather than a definition of the engagement scope.
Conclusion:
Specifying both random and judgmental samplings as part of the engagement scope provides a clear and comprehensive methodology for the audit, making it the most appropriate choice.
Internal Audit Standards and Practice Guides
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