The Auditor May Decide NOT to Reduce Assessed Control Risk

question 102

Multiple Choice

The auditor may decide NOT to reduce assessed control risk even if internal controls are adequate. This approach is followed if:

• A) the cost of the study and tests of controls will exceed the savings from reduced substantive procedures.
• B) the auditor plans to rely on the controls and reduce substantive testing.
• C) a qualified opinion will be issued.
• D) All of the above are true.

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Definitions:

Probability

The quantification of the probability that a specific event will happen, expressed as a value ranging from 0 to 1.

Taller Candidates

Referencing individuals seeking a position or role who are of greater height than typical or average applicants.

Casting Ballot

The act of voting by marking a ballot or electronic means in an election.

Continuous Random Variables

Variables that can take on an infinite number of values within a given range.