Assessing control risk at a level below high most likely would involve:
A) identifying specific internal controls relevant to specific assertions.
B) changing the timing of substantive tests by omitting interim testing and performing the tests at year-end.
C) reducing inherent risk for most of the assertions relevant to significant account balances.
D) performing more extensive substantive tests with larger sample sizes than originally planned.

Question

Quizplus · Accepted Answer

Assessing control risk at a level below high involves identifying specific internal controls relevant to specific assertions. This allows the auditor to rely on these controls and perform fewer substantive tests, reducing the audit effort and cost. Changing the timing of substantive tests (B) does not necessarily reduce control risk, reducing inherent risk (C) is not an appropriate way to address control risk, and performing more extensive substantive tests (D) would increase audit effort and cost, which is not necessary if the control risk can be assessed at a lower level.

Assessing Control Risk at a Level Below High Most Likely