Auditors are most likely to gather audit evidence solely using substantive procedures
A) If transactions are recurring.
B) For nonrecurring, unusual transactions.
C) If control risk is very low.
D) If the entity has a well-designed automated system.

Question

Quizplus · Accepted Answer

Substantive procedures are typically used for nonrecurring, unusual transactions because there may not be a reliable control in place to test. Recurring transactions are usually subject to controls that can be tested to provide assurance over the accuracy and completeness of the transactions. If control risk is very low, auditors may rely more on tests of controls, and if the entity has a well-designed automated system, auditors may use a combination of tests of controls and substantive procedures.

Auditors Are Most Likely to Gather Audit Evidence Solely Using