When the auditor is performing audit data analytics (ADA) as a substantive test of details of a population of transactions or balances, the auditor will have _______.
A)evaluated inherent risk
B)evaluated audit risk
C)confirmed the tests with management prior to conducting them
D)already audited every account in the population

Question

Quizplus · Accepted Answer

Evaluating inherent risk is a fundamental step in the audit process, including when performing audit data analytics (ADA) as a substantive test. It involves assessing the susceptibility of an assertion to a material misstatement, assuming there are no related controls. This evaluation helps in planning the nature, timing, and extent of further audit procedures.

When the Auditor Is Performing Audit Data Analytics (ADA) as a Substantive