In a financial report audit, the amount of direct testing of account balances is inversely related to:
A) subjectivity of estimates
B) riskiness of the account
C) effectiveness of internal control
D) materiality of the account

Question

Quizplus · Accepted Answer

The amount of direct testing of account balances decreases as the effectiveness of internal control increases, because auditors can rely more on the controls in place, reducing the need for direct testing.

In a Financial Report Audit, the Amount of Direct Testing