Observations is one audit procedure that involves cost$-$benefit trade$-$offs. Which of the following statements regarding observation as an audit procedure is $($are$)$ correct?

$1.$ Observation is limited because individuals may react differently when being watched.

$2.$ Observation is more effective for testing completeness than it is for testing existence.

$3.$ Observation provides evidence about whether operating activities are aligned with prescribed policies.

a$.1$ only.

b$.2$ only.

c$.1$ and $3.$

d$,1,2$ and $3.$