The Primary Benefit of a Risk-Based Audit Methodology

D.

The correct answer is D. prioritize audit resources.

A risk-based audit methodology is an approach that uses risk assessment to identify and prioritize areas that require the most attention during an audit. The goal of this methodology is to ensure that audit resources are used effectively and efficiently.

Here are some reasons why prioritizing audit resources is the primary benefit of a risk-based audit methodology:

1. Efficient use of resources: A risk-based approach ensures that limited audit resources are used where they will have the most impact. By focusing on high-risk areas, auditors can use their time and expertise more effectively.

2. Better coverage of high-risk areas: A risk-based approach ensures that the most critical areas are audited thoroughly. This helps to reduce the risk of material misstatements and to identify potential control weaknesses.

3. Improved risk management: A risk-based approach helps organizations to identify and manage risks more effectively. By understanding the key risks facing the organization, auditors can help management to develop appropriate risk mitigation strategies.

4. Increased stakeholder confidence: A risk-based approach provides stakeholders with assurance that the audit is focused on the areas that pose the greatest risk to the organization. This can increase stakeholder confidence in the audit process and the organization's ability to manage risk.

In summary, a risk-based audit methodology is a powerful tool for ensuring that audit resources are used effectively and efficiently. By prioritizing audit resources, organizations can focus on high-risk areas, improve risk management, and increase stakeholder confidence.