After Obtaining an Understanding of an Entity's Internal Control System

Multiple Choice

After obtaining an understanding of an entity's internal control system, an auditor may assess control risk at the maximum level for some account balances because he or she:

A) identifies internal controls that are likely to prevent material misstatements.
B) performs tests of controls to reduce detection risk to an acceptable level.
C) determines that the pertinent internal control components are not well documented.
D) believes the internal controls are unlikely to be operating effectively.