An important reason for adequately planning the audit engagement is to
A)help decide whether the engagement should be accepted.
B)enable the auditor to obtain sufficient appropriate audit evidence.
C)properly design the contents of the engagement letter.
D)keep audit risk as low as possible.

Question

Quizplus · Accepted Answer

Adequate planning of the audit engagement is crucial for the auditor to obtain sufficient appropriate audit evidence to support the audit opinion. Planning helps the auditor to identify the risk factors and design the audit procedures accordingly. This will help the auditor to minimize the risk of material misstatements and avoid wasting resources on unnecessary audit procedures. Therefore, option B is the correct answer. Choice A is incorrect as deciding whether to accept the engagement is part of the pre-engagement activities. Choice C is incorrect as the contents of the engagement letter are based on the terms agreed with the client and are not directly related to planning. Choice D is incorrect as keeping audit risk as low as possible is the objective of the audit but not the sole reason for planning.

An Important Reason for Adequately Planning the Audit Engagement Is