Final Exam ACCT402 Fall 2020 - Saved View X D A HEADING 1 Question 2 Answer by True or False (2 points each) 1. As control risk increases, the amount of substantive evidence the auditor plans to accumulate should increase. A) True B) False 2. If an auditor wishes to rely on the work of internal auditors (IA), the auditor must obtain satisfactory evidence related to the IA's competence, integrity, and objectivity. A) True B) False 3. The most important component of internal control is risk assessment. A) True B) False 4. Internal control is a process designed to provide reasonable assurance regarding the achievement of management's objectives in the following categories: (1) reliability of financial reporting (2) effectiveness and efficiency of operations, and (3) compliance with applicable laws and regulations. A) True B) False 5. In an audit of a company, the less control risk there is, the smaller the amount of planned substantive evidence that is required A) True B) False Smaller companies usually have less extensive internal controls than larger companies which result in more frauds being committed at small companies. A) True B) False