Question

Analytical procedures

A) performed during the audit planning phase generally use aggregate data.
B) are never performed during the testing phase of an audit.
C) are declining in importance as a type of audit evidence.
D) performed during the audit planning stage help the auditor take a final objective look at the audited financial statements.

Answer 1

Analytical procedures performed during the audit planning stage help auditors take an objective look at financial statements.

Step-by-step explanation:

Analytical procedures performed during the audit planning stage help the auditor take a final objective look at the audited financial statements. These procedures involve analyzing financial data and ratios, comparing current and prior years' financial statements, and looking for any significant fluctuations or anomalies.

By conducting analytical procedures, the auditor can gain a better understanding of the client's business and financial performance, identify areas of potential risk or concern, and adjust the nature and extent of further audit procedures accordingly.