For accounts with small balances and minimal potential for material misstatements, auditors often limit their tests to substantive analytical procedures if they conclude the accounts are reasonably stated.

Question

Quizplus · Accepted Answer

This statement is true. Auditors may limit their testing to substantive analytical procedures for accounts with small balances and minimal potential for material misstatements if they determine that the accounts are reasonably stated. This approach is often more efficient and cost-effective for low-risk accounts.

For Accounts with Small Balances and Minimal Potential for Material