When an auditor performs tests of details of balances, the concern is determining:
A) whether the account balance being audited is fairly stated.
B) if the deviation rate in the population is sufficiently low to justify reducing substantive testing.
C) both the effectiveness of controls and the monetary correctness of the transactions.
D) all of the above

Question

Quizplus · Accepted Answer

Tests of details of balances focus on verifying the accuracy of account balances, so the concern is whether the account balance being audited is fairly stated. This type of testing is separate from tests of controls, which focus on the effectiveness of controls, and substantive testing, which aims to establish the monetary correctness of transactions.

When an Auditor Performs Tests of Details of Balances, the Concern