An auditor of a client company that has multiple locations must:
A)increase control risk to moderate or high.
B)conclude that independent business units of the consolidation are immaterial.
C)issue multiple audit reports for each segment of the company.
D)determine the universal application of controls across the company.

Question

Quizplus · Accepted Answer

The auditor must determine the universal application of controls across the company to ensure consistent application of audit procedures and sufficient audit coverage at all locations. This will help to ensure reliable financial reporting for the entire company and reduce the risk of material misstatement. Increasing control risk, concluding that independent business units are immaterial, or issuing multiple audit reports for each segment would not be appropriate responses to auditing a company with multiple locations.

An Auditor of a Client Company That Has Multiple Locations