Mr. David is the auditor of Al Amira Cement Company. He audits the financial statements of the company for the year 2019 and gives a report that the financial statements are true and fair. But in the year 2020 few material misstatement were detected in the financial statements of the company. This risk which has occurred because of Mr. David's failure to detect a material misstatement in the financial statements is known as: Control risk Inherent risk Faulty risk Detection risk

Mr. David is the auditor of Al Amira Cement Company. He audits the financial statements of the company for the year 2019 and gives a report that the financial statements are true and fair. But in the year 2020 few material misstatement were detected in the financial statements of the company. This risk which has occurred because of Mr. David's failure to detect a material misstatement in the financial statements is known as: Control risk Inherent risk Faulty risk Detection risk

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter4: Professional Legal Liability

Section: Chapter Questions

Problem 17RQSC

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