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

Question

Quizplus · Accepted Answer

Tests of details of balances are primarily used to determine whether the account balance being audited is fairly stated. These tests aim to confirm the correctness, completeness, and accuracy of the account balance. While auditing, the auditor may also identify instances where controls have failed, or there are material misstatements. However, the primary goal of these tests is to ensure that the balance is fairly stated. Thus, options A and B are incorrect.

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