When Control Risk Is High, the Audit Strategy Is To

question 49

Multiple Choice

When control risk is high, the audit strategy is to:

• A) do little or no tests of controls and increase reliance on substantive testing of transactions and account balances.
• B) assume the client's management is dishonest and immediately report them to the CRA.
• C) increase reliance on tests of controls and reduce reliance on substantive testing of transactions and account balances..
• D) refuse to continue with the remainder of the audit due to the high risk of fraud.

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Definitions:

Cognitive Psychologists

Psychologists who study the mental processes underlying perception, thought, learning, memory, and decision-making.

Neurobiological Events

Processes or occurrences within the nervous system, often at the cellular or molecular level, that affect neurobiological function or behavior.

Mental Events

Internal occurrences within the mind, such as thoughts, feelings, and perceptions, that can influence behavior.

Social Situations

Environments or occasions where individuals interact with one another, often requiring social awareness and interpersonal skills.