ACCA Advanced Audit and Assurance (AAA) Practice Exam

What is the objective of a preventive application control?

1. To identify errors after they occur

2. To prevent errors or fraud from occurring

3. To expedite processing time

4. To lower operational risks

The correct answer is: To prevent errors or fraud from occurring

The objective of a preventive application control is to prevent errors or fraud from occurring. These types of controls are designed to stop issues before they happen, which helps to maintain the integrity and accuracy of data. For example, user authentication measures ensure that only authorized individuals can access systems, and validation checks on data input can prevent incorrect data from being entered into a system. By focusing on prevention, these controls help organizations minimize the risk of financial loss and maintain compliance with regulatory requirements. This proactive approach is essential in the realm of auditing, as it ensures that processes are established to safeguard against potential risks before they become actual problems. On the other hand, options suggesting identification of errors after they occur or expediting processing time do not align with the purpose of preventive controls. Lowering operational risks is a broader outcome that can result from effective preventive controls, but it is not the primary objective. The focus is distinctly on preventing issues from arising in the first place.