Which of the following statements best describes why an auditor would use only substantive procedures to evaluate specific relevant assertions and risks?
A)The relevant internal control components are not well documented.
B)The internal auditor already has tested the relevant controls and found them effective.
C)Testing the operating effectiveness of the relevant controls would not be efficient.
D)The cost of substantive procedures will exceed the cost of testing the relevant controls.

Question

Quizplus · Accepted Answer

Using only substantive procedures may be more efficient and cost-effective than testing the operating effectiveness of relevant controls, particularly when the cost of testing the relevant controls exceeds the cost of substantive procedures. It is assumed that the auditor has already assessed the design of internal controls and determined that they are not designed effectively, or that the potential for material misstatement is high. Without this determination, the auditor would not rely on substantive procedures alone. The other options are not necessarily good reasons to use only substantive procedures.

Which of the Following Statements Best Describes Why an Auditor