When a substantive audit strategy is adopted, an auditor will O determine internal controls are effective in mitigating risks. O increase the amount of their substantive testing. O test controls extensively. O not need to document the internal control system.

Q: What are the major steps in the audit team’s assessment of control risk in an IT environment?

A: Internal control: Internal control is a process which ensures continuous reliability of…

Q: For each of the following, determine how the effectiveness of the entity's internal control affect…

A: a)  As the entity's internal control is more effective. Auditor would assess less level of material…

Q: Which of the following would be inappropriate during the risk assessment procedure of the audit…

A: We shall answer the first question, since the exact question wasn't specified.Please resubmit a new…

Q: Delineate the protections that may be used to limit or eliminate risks to the independence of the…

A: When the internal and external auditors' work is not influenced by any party that has an interest in…

Q: Explain what lapping means, and discuss the internal control deficiency that allows it discuss the…

A: Lapping: It is a type of cash embezzlement or fraud perpetrated by a firm employee. When cash is…

Q: If the auditor is unable to rely on the IT general controls or application controls of a client,…

A: Correct option is D. Control risk as high   If the auditor is unable to rely on the IT general…

Q: Auditors need to identify audit risk in planning an audit engagement. In doing so, the audit risk…

A: Answer (a) – Audit Risk – Audit risk is a risk that the auditor may give inappropriate opinion when…

Q: True or false Tests of controls generally consist of combination of procedures such as inquiry of…

A: Auditing is the procedure in which the auditor checks and examines the financial statements of the…

Q: Substantive analytical procedures are performed by auditor: To identify and assess detection risk To…

A: Auditor is the person who is responsible for performing audit work. Audit means checking and…

Q: A key criterion in auditing (both internal and external) is independence. In what way (s) can…

A: There are mainly two types of audits in a business that are external audit and internal audit.…

Q: The documentation of the audit strategy is a record of the planned nature, timing and extent of risk…

A: The answer for the True or false question and relevant explanation are presented hereunder : What is…

Q: Is it necessary for an auditor to get a knowledge of a client's internal controls if the auditor…

A: An auditor is required to express an opinion on the true and fair view of the state of affairs and…

Q: Many auditors assert that certain audit tests can be significantlyreduced for clients with adequate…

A: Auditing:   In auditing, auditors verify the correctness and fair presentation of financial…

Q: After considering the client's internal control the auditors have concluded that it is well designed…

A: WHEN AUDITOR FINDS INTERNAL CONTROL TO BE EFFECTIVE , HE REDUCES THE SUBSTANTIVE PROCEDURE . IT…

Q: If the tests of controls indicate certain controls are not as effective as the auditor originally…

A: Test of controls are performed  to determine the effectiveness of the control to detect and correct…

Q: (A) The requirement is to find the best statement concerning an auditor’s assessment of…

A: Control risk alludes to the probability that a large misrepresentation originating from a caused by…

Q: he purpose of ____________ is to help manage and control risk appropriately rather than to eliminate…

A: Answer

Q: Prior to SOX, external auditors were required to be familiar with the client organization’s internal…

A: Sarbanes-Oxley Act: The Sarbanes-Oxley Act (SOX) is introduced for protecting the investors from the…

Q: audit procedures

A: The first statement is false, the higher amount of evidence is required if there is higher…

Q: Auditors have two strategies to choose from, the lower-assessed control risk strategy and the…

A: Incorrect (c)Auditors can always choose to use the predominantly substantive strategy regardless of…

Q: The risk that material errors will not be detected is directly controllable by the auditor through…

A: Auditor: An auditor is a person or a group of people who is responsible for conducting an audit of…

Q: determine if statement 1 and 2 are true or false 1 - The overall audit strategy sets the scope,…

A: 1 - The overall audit strategy sets the scope, timing, and direction of the audit, and guides the…

Q: When an auditor is planning an audit, the auditor should:   Consider whether the extent of…

A: Audit: It is a systematic examination of books of accounts of an individual or a firm. It is done by…

Q: The auditor should assess control risk for each relevant assertion by evaluating the evidence…

A: Relevant assertion: The assertion that shows the possibility of happening a material misstatement is…

Q: Auditing standards indicate that if the preliminary control risk assessment is low, the auditor then…

A: The selection of control by the auditor is based on assessing whether the entity's controls…

Q: In an environment that is highly automated, an auditor determines that it is not possible toreduce…

A:

Q: An organization has a mature control environment but limited audit resources. Given this scenario,…

A: Audit:   It is an examination of the financial statements of the company. It helps in determining…

Q: Which of the following describes the circumstances that exist when an auditor assesses control risk…

A: Solution Concept Control risk means the risk that the internal controls that are required to prevent…

Q: uld consider whether A. the evidential matter obtained from the study of the internal control…

A: Internal control refers to the systematic approach of formulating policies, programs, rules in order…

Q: Auditors are always required to gain a minimum understanding of internal controls, whether or not…

A: Auditing means the independent checking of company operation by outsider. Auditor is  qualified and…

Q: Which of the following audit approaches is most likely to provide an auditor the most confidence in…

A: The analytical approach is adopted by the company in order to assure that at the end of the…

Q: Some audit procedures may be performed before the end of the reporting period. The more the auditor…

A: Auditing is done in order to know and get the report from the auditors that the financial statements…

Q: Which of the following statements is correct concerning analytical procedures used in planning an…

A: Analytical procedures:   Analytical procedures are the examination of the financial statements. The…

Q: Grounds for Dismissal. This case is designed like the ones in the chapter. Your assignment is to…

A:

Q: When gathering data, an audit team identified both subjective and objective criteria for measuring…

A: Audit risk is the risk that auditor may give inappropriate opinion when financial statements are…

Q: In assessing control risk, an auditor selects from a variety of techniques, including A. Inquiry and…

A: Introduction: Auditing means a systematic examination of books to verify the authenticity and…

Q: On the basis of audit evidence gathered and evaluated, an auditor decides to increaseassessed…

A: (1) Increase in inherent risk will lead to an increase in audit risk level as they are directly…

Q: For each of the above deficiencies, identify the possible impact on the company’s operation and…

A: Internal control is a system of organizing the company in which a set of rules, policies, and…

Q: An auditor assesses control risk because it: A. is relevant to the auditor's understanding of the…

A: Audit: Audit is the process of verification of the compliance of the financial statements. It…

Q: The audit plan is more detailed than the overall audit strategy in that it includes the nature,…

A: Auditing means the independent checking of company operation by outsider. Auditor is a qualified and…

Q: If inherent risk is high and a reasonable level of assurance has been gained from control testing,…

A: The inherent audit risk is a risk that exists due to any error or omissions in the financial…

Q: ABOUT AUDITING The process of selecting and developing policies and procedures to help mitigate…

A: Audit Risk- Audit risk is the possibility that an auditor will issue an incorrect opinion on…

Q: Obtaining an understanding of the internal control structure is required for first time audit…

A: Internal control is an efficient system of control is established by the management in the conduct…

Q: Based on evidence gathered and evaluated, an auditor decides to increase the assessedlevel of…

A: Definition: Planned detection risk is the risk in audit evidence for a segment that will fail to…

Q: Generally, which of the following audit procedures is the least expensive to perform?   A.…

A: Analytical procedures are the least expensive audit procedures to perform. Test of controls are…

Q: The auditor’s risk assessment procedures should always include the following, except       a.…

A: Risk assessment processes should be performed by the auditor to provide a foundation for identifying…

Q: The more the auditor relies on the operating effectiveness of controls in the assessment of risk,…

A: AS per the Auditing Standard "The Auditor's Responses to the Risks of Material Misstatement", Some…

Q: Auditors are required to obtain a sufficient understanding of each component of a client’s internal…

A: Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for you. If…