What is a common test for management override of controls in an audit?

Investigating unusual journal entries is a common test for management override of controls in an audit because it directly addresses the potential risk that management could manipulate financial reports and override established controls. Journal entries are often where adjustments to financial data occur, and unusual entries—whether in terms of amount, frequency, or timing—may indicate that management is attempting to alter the financial results inappropriately.

By focusing on these entries, auditors can evaluate whether there are indicators of management overriding internal controls, such as entries made outside the standard process, significant adjustments without adequate justification, or entries that lack proper authorization. This scrutiny is essential for identifying potential fraud or errors that could materially misstate the financial statements.

Other options, while they may provide useful insights into the organization’s operations or compliance, do not specifically target the risk posed by management potentially overriding internal controls. For instance, reviewing small-value transactions could miss significant concerns, analyzing operational meetings might not reveal any illicit intentions, and conducting training sessions for staff does not address the direct examination of financial reporting practices.