If an auditor is testing control on a client's cash disbursements procedures with no audit trail, what method will they most likely use?

When testing controls over a client's cash disbursement procedures that lack an audit trail, the auditor is likely to rely on inquiry and observation. This method involves directly interacting with employees to gather information about the procedures in place and observing those procedures as they are carried out in real-time.

Inquiry allows the auditor to ask probing questions that can reveal how transactions are authorized and processed, providing insight into the control mechanisms that are supposed to be in place. Observation complements this by allowing the auditor to witness the controls in operation, ensuring that the processes described by employees are actually being followed.

In the absence of an audit trail, which typically involves documentation that tracks transactions or transfers, reliance on inquiry and observation becomes critical. These methods provide qualitative data that help the auditor assess the effectiveness of the controls that are designed to prevent unauthorized or improper disbursements. This approach enables the auditor to form a judgment about the adequacy and reliability of the cash disbursement procedures despite the absence of more quantitative, traceable information.

While other methods like digital forensics or data analytics can provide insights into transaction activities, they rely on the existence of data to analyze, which is not applicable in this scenario. Sample testing is also less effective without a robust audit trail to