Which of the following is a false statement about the assessment of the risks of material...
Which of the following is a false statement about the assessment of the risks of material misstatement?
A. The assessed levels will affect the nature, timing, and extent of substantive testing.
B. The auditor may use certain tests of details of transactions concurrently as tests of controls.
C. The ultimate purpose is to determine the operating effectiveness of controls.
D. The auditor’s understanding of internal control should be documented.
Homework Answers
(q) Which of the following is a false statement about the assessment of the risks of material misstatement?
(ans) Option C - The ultimate purpose is to determine the operating effectiveness of controls.
- This is wrong statement because the ultimate purpose of assessment of the risks of material misstatement is to address the risks of material misstatement through appropriate overall audit responses and audit procedures.
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