After Obtaining an Understanding of the Internal Control System and Assessing

question 8

Multiple Choice

After obtaining an understanding of the internal control system and assessing control risk, an auditor decided not to perform additional tests of controls.The auditor most likely concluded that the

• A)Additional evidence to support a further reduction in control risk was not cost-beneficial.
• B)Assessed level of inherent risk exceeded the assessed level of control risk.
• C)Internal control system was properly designed and justifiably may be relied on.
• D)Evidence obtainable through tests of controls would not support an increased level of control risk.

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Definitions:

Gut Feeling

An instinctual, intuitive reaction or response, not based on rational analysis.

Myers-Briggs Type

A personality framework that categorizes people into 16 different types based on preferences in four areas: orientation to the external world, information processing, decision making, and structure.

Intuition

Intuition is the ability to understand or know something immediately, based on feelings rather than conscious reasoning or factual analysis.

High Openness

A personality trait that displays a high level of creativity, curiosity, and a willingness to explore new ideas.