Final answer:
To decrease detection risk, auditors should not reduce substantive testing. Other effective strategies include increasing testing, moving it to year-end, or making it more complex.
Step-by-step explanation:
In order to decrease detection risk, the auditor may do all except reduce substantive testing. Detection risk is the risk that the auditor will not detect a material misstatement that exists in an assertion. To address or decrease this risk, the auditor can take various steps:
- Increase substantive testing - this means performing more detailed tests such as sending confirmations, conducting analytics, or testing more transactions.
- Move substantive testing from an interim date to year-end - this brings testing closer to the time when financial statements are issued, which may capture more up-to-date information.
- Increase the complexity of audit testing - this involves using more sophisticated procedures or larger sample sizes that could detect misstatements which simpler testing might not uncover.
Reducing substantive testing would actually increase detection risk, as the auditor is performing fewer checks and has less information to identify potential errors. Since the goal mentioned is to decrease detection risk, all other options except reducing substantive testing would be strategies an auditor may adopt.