If no material differences are found using analytical procedures, and the auditor concludes that misstatements are not likely to have occurred,
A) other substantive tests may be reduced.
B) it will be necessary to increase the tests of balances.
C) it will not be necessary to perform tests of balances.
D) it will be necessary to increase the tests of transactions.

Question

Quizplus · Accepted Answer

When analytical procedures indicate no material differences, it suggests that misstatements are less likely, allowing the auditor to consider reducing other substantive tests due to the lower assessed risk of material misstatement.

If No Material Differences Are Found Using Analytical Procedures, and the Auditor