The risk assessment phase of an audit involves the performance of detailed tests of controls and substantive testing of transactions and accounts.

Question

Quizplus · Accepted Answer

The risk assessment phase of an audit involves understanding the entity and its environment, including its internal control, to assess the risks of material misstatement, not the performance of detailed tests of controls and substantive testing of transactions and accounts, which occur in later phases.

The Risk Assessment Phase of an Audit Involves the Performance