The Auditor Is Performing Substantive Procedures Several Months Before the End

question 1

Multiple Choice

The auditor is performing substantive procedures several months before the end of the year. This most likely means that:

• A) inherent risk is set at high.
• B) detection risk is set at high
• C) control risk is set at maximum.
• D) none of the above are correct

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Definitions:

Observation

The process of monitoring or noting phenomena with the aim of collecting data or arriving at conclusions.

Application

The act of putting something to use or implementing a concept, method, or device for a particular purpose.

Parsimony

The principle or idea of simplicity, especially in scientific explanations, by preferring the least complicated explanation.

Scope

The extent of the area or subject matter that something deals with or to which it is relevant.