ACCA Audit and Assurance (F8) Practice Exam

What is a key reason for reviewing minutes of board meetings during an audit?

1. To track attendance of members

2. To understand decision-making and approve financial allocations

3. To evaluate staff performance

4. To analyze fundraising strategies

The correct answer is: To understand decision-making and approve financial allocations

Reviewing the minutes of board meetings is crucial during an audit primarily because it helps in understanding the decision-making processes of the organization and any approved financial allocations. The minutes provide a record of discussions, decisions, and actions agreed upon by the board, which can directly impact financial statements and the overall financial position of the entity. By examining these minutes, auditors can gain insight into how key strategic decisions were reached, including approving budgets and resource allocations, which are vital for assessing the accuracy and completeness of financial records. The other options, while related to various aspects of organizational governance, do not directly align with the primary purpose of reviewing board minutes in an audit context. For instance, tracking member attendance does not inform financial allocations or decision-making, and evaluating staff performance or analyzing fundraising strategies, although important, are not the primary focus of examining board meeting documentation during an audit.