Question

A factor that auditors consider when determining the type of substantive procedure to use is _______.

1) the assessed level of risk for the assertion
2) the assessed level of risk for the control
3) the cost of the procedure, and if management will be able to afford it
4) the recommendations of management

Answer 1

Auditors consider the assessed level of risk for the assertion when determining the type of substantive procedure to use.

Step-by-step explanation:

A factor that auditors consider when determining the type of substantive procedure to use is the assessed level of risk for the assertion. Auditors assess the risk associated with each assertion to determine the extent of the substantive procedures needed to obtain reasonable assurance. The higher the assessed risk, the more extensive the substantive procedures required to address the risk.