When the auditor detects an intentional misstatement they should all of the following except:
A) reconsider the level of audit risk for the client
B) directly advise ASIC first
C) consider revising the nature, timing, and extent of audit procedures
D) alert management and the audit committee or board

Question

Quizplus · Accepted Answer

When an auditor detects an intentional misstatement, their first step should not be to directly advise the Australian Securities and Investments Commission (ASIC) or any regulatory body. The appropriate initial actions include alerting management and the audit committee or board, reconsidering the level of audit risk, and considering revising the audit approach. Reporting to regulatory bodies like ASIC typically comes after these steps, especially if the entity does not take appropriate action to address the misstatement.

When the Auditor Detects an Intentional Misstatement They Should All