Question

During financial statement audits, the auditors' consideration of their clients' internal control is integral to both assess the risk of material misstatement and to:

A. Assess inherent risk.
B. Design further audit procedures.
C. Assess compliance with the Foreign Corrupt Practices Act.
D. Provide a reasonable basis for an opinion on compliance with applicable laws

Answer 1

During financial statement audits, auditors consider their clients' internal controls to assess the risk of material misstatement and design further audit procedures.

Step-by-step explanation:

During financial statement audits, auditors consider their clients' internal controls to assess the risk of material misstatement and to design further audit procedures. Evaluating internal controls helps auditors gain assurance about the reliability of the financial statements and identify areas of potential risk and fraud. By assessing internal controls, auditors can provide a reasonable basis for their opinion on the company's compliance with applicable laws and regulations.