Which of the following procedures would most likely be performed in response to the auditor's assessment of the risk of monetary misstatements in the financial statements?
A)Ratio analysis
B)Tests of controls
C)Tests of details of balances
D)Risk assessment procedures

Question

Quizplus · Accepted Answer

Tests of details of balances are performed in response to the auditor's assessment of the risk of monetary misstatements in the financial statements. These tests are designed to obtain substantive evidence about the monetary amounts in the financial statements, including testing individual transactions, account balances, and disclosures. Ratio analysis, tests of controls, and risk assessment procedures are all important components of the audit process, but they are not specifically focused on the risk of monetary misstatements.

Which of the Following Procedures Would Most Likely Be Performed