After Obtaining an Understanding of Internal Control and Arriving at a Preliminary

question 5

Multiple Choice

After obtaining an understanding of internal control and arriving at a preliminary assessed level of control risk,an auditor decided to perform tests of controls.The auditor most likely decided that:

• A)Additional evidence to support a reduction in the assessed level of control risk is not available.
• B)An increase in the assessed level of control risk is justified for certain financial statement assertions.
• C)It would be efficient to perform tests of controls that would result in a reduction in planned substantive procedures.
• D)There were many internal control deficiencies that would allow misstatements to enter the accounting system.

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Definitions:

High-Pitched

Describes a sound that is sharp and has a frequency at the higher end of the human's hearing range.

Tarry Stool

Black, sticky stools indicative of gastrointestinal bleeding.

Gastrointestinal Bleeding

The loss of blood occurring within the gastrointestinal tract, which can manifest as vomiting blood or blood in the stool.

Gallbladder Disease

A broad term for disorders affecting the gallbladder, such as cholecystitis or gallstones, often leading to symptoms like pain and digestive problems.