In performing the audit of internal control over financial reporting, the auditor emphasizes internal control over classes of transactions because
◦ the accuracy of accounting system outputs depends heavily on the accuracy of inputs and processing.
◦ the class of transaction is where most fraud schemes occur.
◦ account balances are less important to the auditor then the changes in the account balances.
◦ classes of transactions tests are the most efficient manner to compensate for inherent risk.