Sas No. 115 Case Study

SAS No. 115 SAS No. 115 in particular guides auditors on the way that they should deal with the internal control deficiencies in the case of performing their work. In particular, the auditors remain guided on what they should do in the case that they discover deficiencies in the internal control of an entity especially at the time when they are auditing the financial statements. The section is applicable in the case where the auditor issues a statement to the point of disclaiming or expressing a disclaimed opinion. As part of the guidance, the auditors are given a benchmark in the way that they should identify the deficiency in internal control, the significance of the deficiency in auditing and finally the materials dealing with the material weaknesses. The auditors are guided on the way that they should proceed to identify the severity of the deficiencies in the internal control that they identify while auditing the financial positions. (Communicating Internal Control, Section .8) As part of the evaluation of the deficiency, the standard asserts that the auditors should establish whether the defect can be termed as a significant or material weakness when it is taken individually or in combination. As a guiding element, the standard asserts that in the determination of the severity …show more content…
These lead the auditors in the direction that they should focus their energy and also be keen to identify so that they should identify the deficiencies in the internal control. These include the financial statements amounts and the volume of activities that are exposed to the deficiencies. The standard also guides the auditors on the ways that they should perform the standard tests and procedures that can help them determine the effectiveness of the internal controls in carrying out the operations. (Communicating Internal Control, Section