If control risk is assessed high,cost accumulations will require additional substantive procedures to lower the risk of failing to detect material misstatements in inventory.

Question

Quizplus · Accepted Answer

If control risk is assessed as high, it means that the internal controls in place are not effective enough to prevent or detect material misstatements in inventory. Therefore, additional substantive procedures (such as physical inventory counts or extensive sample testing) are necessary to lower the risk of failing to detect such misstatements. This can increase the overall cost of the audit.

If Control Risk Is Assessed High,cost Accumulations Will Require Additional