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CS Professional · Internal and Forensic Audit · Internal Audit Tools and Techniques

Before relying on a CAAT extract of the debtors ledger of Malabar Foods Ltd, which step should the internal auditor perform first to ensure the audit evidence is reliable?

The auditor should first reconcile the control totals and record counts of the extracted file with the accounting records. This confirms that the data is complete and accurate, so that subsequent CAAT analysis rests on reliable evidence rather than a faulty or partial extract.

  1. ADistribute the extract to the sales team for comments
  2. BSelect the sample immediately to save time
  3. CReconcile the control totals of the extracted data with the accounting records to confirm completeness and accuracyCorrect
  4. DDelete records with zero balances from the extract

Explanation

Before analysis, the auditor must confirm the extracted data is complete and accurate by agreeing record counts and totals with the books. Sampling first risks relying on incomplete data, and removing records or sharing with auditees weakens integrity and independence.

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