Michael Fernandez has decided to perform substantive procedures at a major retailer. Which one of the following is not a substantive procedure?
A) re-performing control procedures to test their effectiveness
B) inspecting documents to verify the dates of the transactions
C) bank confirmations regarding interest rates on borrowings by client
D) recalculating an interest expense using confirmed interest rates

Question

Quizplus · Accepted Answer

Re-performing control procedures to test their effectiveness is considered a test of controls, not a substantive procedure. Substantive procedures are designed to detect material misstatements in the financial statements, whereas tests of controls assess the effectiveness of the entity's internal control over financial reporting.

Michael Fernandez Has Decided to Perform Substantive Procedures at a Major