An increased extent of tests of controls is most likely to occur when
A) it is a first-year audit.
B) the auditor is doing a "fraud audit."
C) controls are effective and the preliminary control risk assessment is low.
D) controls are ineffective and the preliminary control risk assessment is high.

Question

Quizplus · Accepted Answer

When controls are effective and the preliminary control risk assessment is low, auditors are more likely to increase the extent of tests of controls. This approach allows them to rely more on the effectiveness of the controls and potentially reduce the extent of substantive testing.

An Increased Extent of Tests of Controls Is Most Likely