An auditor$$s decision either to apply analytical procedures as substantive tests or to perform substantive tests of transactions and account balances usually is determined by the

availability of data aggregated at a high level.

timing of tests performed after the balance sheet date.

auditor$$s familiarity with industry trends.

relative effectiveness and efficiency of the tests.

The auditor faces a risk that the audit will not detect material misstatements that occur in the accounting process. To minimize this risk, the auditor relies primarily on

internal control.

tests of controls.

substantive tests.

statistical analysis.

A conceptually logical approach to the auditor$$s evaluation of internal control consists of the following four steps:

Determining the internal controls that should prevent or detect and correct errors and fraud.

Identifying control deficiencies to determine their effect on the nature, timing, or extent of auditing procedures to be applied and suggestions to be made to the client.

Determining whether the necessary internal control procedures are prescribed and are being followed satisfactorily.

Considering the types of errors and fraud that can occur.

What should be the order in which these four steps are performed?

I, II$,$ III, and IV

I, III, IV$,$ and II

III, IV$,$ I, and II

IV$,$ I, III, and II