Question

Which of the following statements is true regarding the audit process?

a) Risk assessment - corroborating evidence is not required; final analytical procedures - corroborating evidence is required
b) Assess IC to plan NET; looking for areas of potential misstatements (substantive vs. reliance strategy)
c) IC are strong; rely on IC so less substantive test work; CR low so DR high
d) Auditor must gain an understanding of "CRIME" (five components of IC); document the understanding; assess control risk

Answer 1

The true statement regarding the audit process is that the auditor must gain an understanding of "CRIME" (five components of IC), document the understanding, and assess control risk.

Step-by-step explanation:

The true statement regarding the audit process is d) Auditor must gain an understanding of "CRIME" (five components of IC); document the understanding; assess control risk.