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Test of controls – When the audit strategy involves relying on the operating effectiveness of the
controls for some assertions in the design of substantive procedures or when substantive
procedures alone do not provide sufficient appropriate audit evidence at the assertion level, the
auditor should design and perform tests of the operating effectiveness of controls (ToC).
Additionally, they will perform procedures to evaluate the design of internal controls and
determine whether they are implemented.
Threat event – An event or situation that can cause undesirable consequences or have a
negative impact.
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