The auditor's assessment of control risk is a critical one because it affects the auditor's decisions about:
A) tests of controls.
B) tests of details of balances.
C) substantive tests of transactions.
D) all of the above

Question

Quizplus · Accepted Answer

The auditor's assessment of control risk affects all of the above decisions. If control risk is assessed as high, the auditor will rely less on tests of controls and more on tests of details of balances and substantive tests of transactions. If control risk is assessed as low, the auditor will rely more on tests of controls and less on tests of details of balances and substantive tests of transactions. Therefore, the auditor's assessment of control risk is critical in determining the nature, timing, and extent of audit procedures to be performed.

The Auditor's Assessment of Control Risk Is a Critical One