If inherent risk is low and a reasonable level of assurance has been gained from controls testing, extensive substantive procedurneed to be performed to estimate the dollar value of any error in an account balance.

Question

Quizplus · Accepted Answer

If inherent risk is low and controls are effective, then substantive procedures do not need to be extensive. This means that the dollar value of any error in an account balance is likely low or insignificant. However, some level of substantive procedures is still necessary to ensure reasonable assurance.

If Inherent Risk Is Low and a Reasonable Level of Assurance