Before auditors can use substantive analytical procedures, _______.
A)they must be ready to issue the preliminary audit opinion
B)they must consider the availability and reliability of data to be used to develop their expectation
C)they must consider the availability and reliability of data to be used to develop their audit opinion
D)they must be approved by the internal auditors beforehand

Question

Quizplus · Accepted Answer

Before auditors can use substantive analytical procedures, they must consider the availability and reliability of data to be used to develop their expectation. This is necessary to ensure that the procedures are effective and reliable in detecting material misstatements in the financial statements. The availability and reliability of the data used to develop the expectation can impact the extent of substantive procedures necessary to support the audit opinion. Therefore, it is important for auditors to carefully evaluate the data before using substantive analytical procedures. Choice A is incorrect because the use of substantive analytical procedures does not depend on the readiness to issue the preliminary audit opinion. Choice C is incorrect because the use of substantive analytical procedures is not related to the development of the audit opinion. Choice D is incorrect because there is no requirement for approval by internal auditors before using substantive analytical procedures.

Before Auditors Can Use Substantive Analytical Procedures, _______