On the Basis of Audit Evidence Gathered and Evaluated,an Auditor

question 21

Multiple Choice

On the basis of audit evidence gathered and evaluated,an auditor decides to increase the assessed level of control risk from that originally planned.To achieve an overall audit risk level that is substantially the same as the planned audit risk level,the auditor would ________.

• A)decrease inherent risk to offset the increased control risk level
• B)decrease detection risk and increase planned substantive audit procedures
• C)increase inherent risk and decrease planned substantive audit procedures
• D)increase materiality levels

---

Definitions:

Staffing Budget

A staffing budget outlines the financial resources allocated for hiring and compensating employees within a specific time period.

Nonmanufacturing Businesses

Companies that do not produce physical goods, focusing instead on services, retail, distribution, and other non-manufacturing activities.

Operating Expenses Budget

A financial plan detailing the forecasted expenses required to manage and administer a business outside of direct production costs.

Supplemental Schedules

Additional financial documents provided alongside the main financial statements, offering greater detail or breakdown of information.