Mario,the owner of Clayton's ice cream,is giving Steve,the manager of the audit,a private tour of the production facilities.By doing the tour,Steve will
A)be better able to identify control risks.
B)understand the client's business and operations better.
C)be able to gather audit evidence on operational efficiencies.
D)Steve should not be taking a tour alone with the owner as this could compromise his independence.

Question

Quizplus · Accepted Answer

By taking a private tour of Clayton's ice cream, Steve can gain a better understanding of the client's business and operations. This can help him assess the risk of material misstatement, identify areas where there may be control risks, and ultimately gather audit evidence on operational efficiencies. As long as Steve maintains his independence and objectivity, there is no issue with him taking a private tour with the owner of the company.

Mario,the Owner of Clayton's Ice Cream,is Giving Steve,the Manager of the Audit,a