Which of the following should an auditor do when control risk is assessed at the maximum level?
A)Perform fewer substantive tests of details.
B)Perform more tests of controls.
C)Document the assessment.
D)Document the control structure more extensively.

Question

Quizplus · Accepted Answer

When control risk is assessed at the maximum level, it indicates that the auditor believes the internal controls are ineffective or that it is not efficient to test the effectiveness of the controls. Therefore, the auditor must document this assessment as part of the audit evidence and rationale for the approach taken in the audit. This documentation is crucial for the audit trail and for supporting the auditor's conclusions and decisions regarding the audit approach, including the reliance on substantive procedures over tests of controls.

Which of the Following Should an Auditor Do When Control