Question

When the auditors assess control risk too high they will:

A. Perform more substantive testing than is necessary.
B. Perform more control testing than is necessary.
C. Perform less control testing than is necessary.
D. Perform less substantive testing than is necessary.

Answer 1

Auditors will perform more substantive testing when they assess control risk as too high, to ensure that material misstatements in financial statements are detected due to potentially inadequate internal controls.

Step-by-step explanation:

When auditors assess control risk as too high, they will A. Perform more substantive testing than is necessary. This is because the assessment of high control risk implies that there may be greater potential for material misstatements in the financial statements due to inadequate internal controls. As a result, auditors increase the extent of substantive procedures, which involve detailed testing of transactions and balances, to obtain sufficient appropriate audit evidence to reduce audit risk to an acceptably low level.