Step 2 of the Planning Process Is the Risk Assessment

Multiple Choice

Step 2 of the planning process is the risk assessment phase.At this stage of the planning process the objective of the auditor is to identify and assess the risk of material misstatement.The auditor does this by

A) gaining an understanding of the company and its management,including the company's financial controls
B) gaining an understanding of the company's industry,including the company's competition
C) determining materiality
D) determining risk assessment procedures to assess the risk of material misstatement at the financial statement and assertion level