An Auditor May Decide to Assess Control Risk at High

question 44

Multiple Choice

An auditor may decide to assess control risk at high for certain assertions because the auditor believes:

• A)evaluating the effectiveness of control policies and procedures is inefficient.
• B)sufficient evidential matter to support the assertions is likely to be available.
• C)considering the relationship of assertions to specific account balances is more efficient.
• D)more emphasis on tests of controls than substantive tests is warranted.

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Definitions:

Normal Distribution

A symmetrical, bell-shaped distribution of data where most measurements are concentrated around the mean, describing many types of naturally occurring data.

Empirical Rules

statistical rules that apply to normal distributions, describing how many observations fall within certain standard deviations from the mean.

Label

A label is a piece of information attached to an object, product, or document that provides identification, description, warnings, or instructions.

Operating Departments

Divisions or units within an organization directly involved in its core operational activities, responsible for creating products or services.