The Audit Strategy for a Client with High Inherent Risk

question 50

Multiple Choice

The audit strategy for a client with high inherent risk and high control risk will include

• A) no or very limited tests of controls.
• B) decreased reliance on substantive tests.
• C) increased testing of controls.
• D) increased reliance on controls.

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Definitions:

Internal Locus

The belief that one has control over their life events and outcomes, rather than external forces having that control.

Relative Deprivation

A psychological condition where individuals feel disadvantaged or deprived when comparing themselves to others who they perceive as better off.

Impulse Gratification

The act of seeking immediate pleasure or fulfillment without regard for the longer-term consequences.

Depleting Self-Control

The concept that self-control is a finite resource that diminishes with use, leading to decreased ability to resist temptation or persist in challenging tasks.