Auditing & Assurance Services 6th Edition by Timothy Louwers

Exercise 3

Which of the following statements best describes auditors' responsibility for detecting a client's noncompliance with a law or regulation?
A) The responsibility for detecting noncompliance exactly parallels the responsibility for errors and fraud.
B) Auditors must design tests to detect all material noncompliance that indirectly affects the financial statements.
C) Auditors must design tests to obtain reasonable assurance that all noncompliance with direct material financial statement effects is detected.
D) Auditors must design tests to detect all noncompliance that directly affects the financial statements.