Which of the following procedures would an auditor most likely perform during an audit engagement's overall review stage in formulating an opinion on an entity's financial statements?
A.
Obtain assurance from the entity's attorney that all material litigation has been disclosed in the financial statements.
B.
Verify the clerical accuracy of the entity's proof of cash and its bank cutoff statement.
C.
Determine whether inadequate provisions for the safeguarding of assets have been corrected.
D.
Consider whether the results of audit procedures affect the assessment of the risk of material misstatement due to fraud.
Suggested Answer:D🗳️
Choice "D" is correct. During every stage of the audit, the auditor should consider the assessment of the risk of material misstatement. During the overall review stage, the auditor should consider whether the results of any of the audit procedures affect the assessment of the risk of material misstatement due to fraud. Choice "A" is incorrect. The entity's attorney does not provide assurance regarding financial statement disclosure. Choice "B" is incorrect. Verifying clerical accuracy of client schedules would be performed during the audit, not during the overall review stage. Choice "C" is incorrect. Evaluating whether control weaknesses have been corrected is not typically performed during the overall review stage.
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