Auditing sophisticated financial instruments requires the auditor to obtain an understanding of all of the following except

Question

Quizplus · Accepted Answer

While the credit rating of the client may be relevant to the overall financial health of the client, it is not directly relevant to obtaining an understanding of the sophisticated financial instrument being audited. The auditor should focus on understanding the risks, objectives, contracts, terms, and accounting and disclosure requirements surrounding the instrument.

Auditing Sophisticated Financial Instruments Requires the Auditor to Obtain an Understanding