Which of the following is true regarding the financial assertions?
A) All assertions can be proved using only substantive procedures, but it would be too costly.
B) Some assertions are virtually impossible to prove without some evaluation of control effectiveness.
C) Some assertions can be proved using only an evaluation of control effectiveness.
D) The evaluation of control effectiveness is only used because it is more efficient than using only substantive procedures.

Question

Quizplus · Accepted Answer

Some assertions, such as completeness and accuracy, may require an evaluation of control effectiveness in addition to substantive procedures in order to obtain sufficient evidence. This is because control deficiencies can result in misstatements that may not be detected through substantive procedures alone. However, not all assertions require an evaluation of control effectiveness. Option A is incorrect because not all assertions can be proved using only substantive procedures; as mentioned earlier, some assertions require an evaluation of control effectiveness as well. Option C is incorrect because although some assertions may be proven through control evaluations, this does not apply to all assertions. Option D is incorrect because control evaluations may actually be more time-consuming than performing only substantive procedures, though they can provide valuable evidence.

Which of the Following Is True Regarding the Financial Assertions