As the acceptable level of detection risk decreases,the assurance directly provided from
A) Substantive procedures should increase.
B) Substantive procedures should decrease.
C) Tests of controls should increase.
D) Tests of controls should decrease.

Question

Quizplus · Accepted Answer

As the acceptable level of detection risk decreases, the auditor will want to be more certain about the accuracy of the financial statements. This means that the level of assurance required from substantive procedures should increase. Substantive procedures are direct tests of the balances and transactions in the financial statements, and provide more direct evidence than tests of controls which evaluate the effectiveness of the client's internal controls.

As the Acceptable Level of Detection Risk Decreases,the Assurance Directly