Performance Principle. Identify how each of the following statements relates to the performance principle by considering which element(s) of the principle are related to that statement. (A statement may be related to more than one element.) Use the following elements inproviding your response:∙ Reasonable assurance∙ Planning and supervision∙ Materiality∙ Risk assessment∙ Audit evidencea. Evaluating the effectiveness of the client’s internal control in preventing or detectingmisstatements.b. Obtaining an understanding of the client’s business and industry.c. Acknowledging that the risk of failing to detect a material misstatement cannot bereduced to zero.d. Obtaining confirmations from the client’s customers as to the ending balances inaccounts receivable.e. Preparing a written audit plan.f. Designing audit procedures to identify misstatements that would have a significanteffect on financial statement users’ decisions.g. Considering the likelihood that the account balance contains a material misstatement.h. Failing to detect material misstatements because of audit team mistakes and misinterpretations in evaluating evidence
Performance Principle. Identify how each of the following statements relates to the performance principle by considering which element(s) of the principle are related to that statement. (A statement may be related to more than one element.) Use the following elements in
providing your response:
∙ Reasonable assurance
∙ Planning and supervision
∙ Materiality
∙ Risk assessment
∙ Audit evidence
a. Evaluating the effectiveness of the client’s internal control in preventing or detecting
misstatements.
b. Obtaining an understanding of the client’s business and industry.
c. Acknowledging that the risk of failing to detect a material misstatement cannot be
reduced to zero.
d. Obtaining confirmations from the client’s customers as to the ending balances in
accounts receivable.
e. Preparing a written audit plan.
f. Designing
effect on financial statement users’ decisions.
g. Considering the likelihood that the account balance contains a material misstatement.
h. Failing to detect material misstatements because of audit team mistakes and misinterpretations in evaluating evidence
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