Gloria Roberts, CPA, expresses the following viewpoint:

I don't believe in performing tests of controls and substantive tests of transactions for the sales and collection cycle. As an alternative, I send a lot of negative confirmations on every audit at an interim date. If I find a lot of misstatements, I analyse them to determine their cause. If internal controls are inadequate, I send positive confirmations at year-end to evaluate the amount of misstatements. If the negative confirmations result in minimal misstatements, which is often the case, I have found that the internal controls are effective without bothering to perform tests of controls and substantive tests of transactions, and ASA 505's confirmation requirement has been satisfied at the same time. In my opinion, the best test of internal controls is to go directly to third parties.

Evaluate Gloria's point of view.