ADA as a risk assessment procedure versus a substantive test Timothy Steele, a recent college graduate and new audit staff member, is having lunch with Michael Watts, an audit senior. Both are working on the audit engagement of a retailer that has operations in North America and Europe. Timothy has another question for Michael: In my reading I have seen a number of examples of audit data analytics. However, I am having a difficult time distinguishing between ADA as a risk assessment procedure and ADA as a substantive test. Can you explain the difference to me and illustrate with a practical example?

Required

Answer Timothy's questions. Explain the difference between ADA as a risk assessment procedure and ADA as a substantive test. Illustrate your explanation with practical illustrations.