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Question a) Why the following statements are wrong?
1. Effective performance of planned tests of controls is less critical in reducing audit risk than effective performance of planned substantive tests.
2. To address completeness for sales revenue, before issuing an invoice, the client should check that he details on the invoice are reconciled to a customer purchase order and shipping documents, and follow up all exceptions.
Question b) Which of the following statements relating to sampling when performing tests of controls is most correct?
A. Systematic selection is an appropriate non-statistical sampling approach for testing controls.
B. Statistical sampling eliminates sampling risk.
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