When the inherent risk and control risk assessment is high:
A) there are no controls tested or relied upon.
B) minimal substantive tests are performed.
C) the amount of substantive testing is significant.
D) Both a and c

Question

Quizplus · Accepted Answer

When both inherent risk and control risk assessment is high, there are no effective controls to rely upon. Hence, the amount of substantive testing required is significant to obtain reasonable assurance about the financial statements. Therefore, choices A and C are both applicable.

When the Inherent Risk and Control Risk Assessment Is High