B is corrent because professional standards require that an auditor assess the difficulty in controlling the incremental audit risk. In addition, the auditor should consider the cost of the substantive tests that are necessary to appropriately examine the remaining period.
A is incorrect because while control risk (or risk of material misstatement) will generally be assessed at below the maximum level in such circumstances, this is not required.
C is incorrect because while inherent risk may be at the maximum level, the situation in which it is not is more likely, since a lower level of risk is more likely to lead to interim testing.
D is incorrect because the accounts tested need not be insignificant.
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