Which of the Following Courses of Action Is Most Appropriate

question 38

Multiple Choice

Which of the following courses of action is most appropriate if an auditor concludes that there is a high risk of material misstatement?

• A)Use smaller, rather than larger, sample sizes.
• B)Perform substantive tests as of an interim date.
• C)Select more effective substantive tests.
• D)Increase tests of controls.

---

Definitions:

Z-value

A statistical measure representing the number of standard deviations from the mean a data point is.

Lower Limit

The lowest value in a set of data, or the minimum value that a certain variable, function, or sequence can assume.

Specification Limits

Pre-determined bounds that define the acceptable range of variation for a product's characteristics or a process's outputs.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how spread out the values are from the average.