An auditor receives anonymous information that fraud is occurring in the operation being audited, but no details are given as to the type of fraud or the individuals involved. There are several areas in which fraud could occur.

An auditor receives anonymous information that fraud is occurring in the operation being audited, but no details are given as to the type of fraud or the individuals involved. There are several areas in which fraud could occur.

The auditor should:
A . Identify the area that has the greatest volume of transactions and design a sampling plan for substantive testing.
B . Apply analytical procedures to areas that might be impacted by possible fraudulent activities.
C . Interview employees to identify areas where the fraud could be occurring.
D . Plan detailed tests of the areas that have the highest dollar amount of transactions.

Answer: B