1. Why do auditors seek to perform some Computer-Assisted Audit Techniques (CAAT) on a surprise basis (if possible)?

2. Artfluent is a gallery specializing in selling original paintings by up-and-coming artists. The medium used by the artists is watercolor which is rarer than other mediums since it is the most difficult to use. Due to the rarity of these works, a very active market exists for them. Several representatives from Artfluent travel across the country to sell the works and to discover new artists. An excerpt from Artfluents travel policy is below. Airfare: Coach or economy airline service shall be used for all domestic flights. Domestic flights include all flights within the continental United States, and flights to and from the United States, Canada and Mexico. Flights within the continental U.S. and flights to and from the U.S., Canada and Mexico in excess of $400 and $600, respectively, must be approved by the gallery manager. Without such approval, the amount of the airfare exceeding the pre-established limits will not be reimbursed. Expense Report Submission and Reimbursements: All expense reports must be accompanied by detailed receipts and submitted to the accounting department within 30 days after the expenses were incurred. Check runs are scheduled every two weeks. Assume that you are auditing Artfluents airfare expenses and are planning tests of IT controls over the processing of airfare reimbursements to employees. a) What type of data processing system does Artfluent use for airfare expense reimbursements? b) What type of testing approach would you plan to use to test IT controls in place to ensure that airfare reimbursements are consistent with the gallerys policy? c) Given the testing approach chosen in (b), how would you execute your tests of Artfluents IT controls over airfare reimbursements? Be specific.