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If the auditor assesses high IR and high CR for an assertion, the auditor must:
AUse only inquiry
BHold the same procedures as last year
CReduce planned DR by performing more extensive and/or more reliable procedures
DSkip testing
Answer & Solution
Correct answer: D. Skip testing
1. When IR×CR is high, DR must be reduced to keep AR acceptably low.
2. This means more extensive, more rigorous, or differently-timed procedures.
3. Repeating last year unchanged does not respond to risk.
_Source: ICAI BoS CA Final Paper 3, Ch 3 "Risk Assessment and Internal Control"_
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