Question

if auditors assess control risk at the maximum level, they will tend to a. perform a great deal of substantive balance sheet audit work. b. perform a great deal of additional tests of controls. c. perform more audit procedures using internal evidence. d. perform substantive tests at an interim date.

Answer 1

Auditors will a. perform a great deal of substantive balance sheet audit work if control risks are assessed at the maximum level.

Step-by-step explanation:

When auditors assess control risk at the maximum level, they believe that the internal controls in place are ineffective in preventing and detecting material misstatements. As a result, they will rely more on substantive procedures, such as performing a great deal of substantive balance sheet audit work.

This involves verifying account balances, transactions, and disclosures directly, instead of relying on the controls. By doing so, auditors gather more audit evidence using external evidence to form an opinion on the financial statements. Therefore, the correct answer is a. perform a great deal of substantive balance sheet audit work.