ACCA Advanced Audit and Assurance (AAA) Practice Exam

What is one of the auditor’s main responsibilities under ISA 330?

1. To establish the client’s risk profile

2. To ensure proper documentation of the audit process

3. To obtain sufficient appropriate audit evidence regarding assessed risks

4. To evaluate the effectiveness of internal controls

The correct answer is: To obtain sufficient appropriate audit evidence regarding assessed risks

One of the auditor’s main responsibilities under ISA 330 is to obtain sufficient appropriate audit evidence regarding assessed risks. This standard emphasizes the auditor's need to respond to the risks of material misstatement identified during the risk assessment phase. In the auditing process, once risks have been assessed, it is crucial for auditors to gather evidence that is both sufficient (enough quantity) and appropriate (relevant and reliable) to support their conclusions on the financial statements. The focus on evidence is fundamental to the audit’s objective of providing a reasonable assurance that the financial statements are free from material misstatement, whether due to fraud or error. The process requires auditors to design and perform procedures that are tailored to address the specific risks identified, which may include testing controls, performing substantive tests, and using analytical procedures. The emphasis on obtaining sufficient and appropriate audit evidence ensures that auditors can form an opinion that is well-supported by their findings, thus fulfilling their responsibilities under the international auditing standards. Establishing the client's risk profile can be a part of the overall risk assessment process, but it is not directly a responsibility outlined in ISA 330. Similarly, while proper documentation of the audit process is important, and evaluating the effectiveness of internal controls is part of the overall audit