This term is synonymous withacceptable audit risk.O Audit assuranceO Tolerable misstatementO Detection riskO Materiality

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This term is synonymous with acceptable audit 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

Chapter7: Planning The Audit: Identifying, Assessing, And Responding To The Risk Of Material Misstatement

Section: Chapter Questions

Problem 5CYBK

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This term is synonymous with
acceptable audit risk.
O Audit assurance
O Tolerable misstatement
O Detection risk
O Materiality

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The risk of material misstatement is composed of which audit risk components?a. Inherent risk and control risk.b. Control risk and detection risk.c. Inherent risk and detection risk.d. Inherent risk, control risk, and detection risk.
Inherent risk and control risk differ from detection risk in which of the following ways? A. Inherent risk and control risk are calculated by the client B. inherent risk and control risk exist independently of the audit. C. Inherent risk and control risk are controled by the auditor. D. Inherent risk and control risk exist as a result of the auditor's judgement about materiality.
Which of the following is appropriate about risk assessment? A. The assessed level of inherent and control risk can be sufficiently low, thus resulting to eliminating the need for substantive tests. B. Audit risk may be more effectively determined by assessing inherent and control risk separately. C. Detection risk is eliminated if an auditor were to examine 100 percent off the account balance or class of transactions. D. There is an iverse relationship between detection risk and the combined level of inherent and control risk
Which of the following statements correctly defines the term reasonable assurance? A. A substantial level of assurance to allow an auditor to detect a material misstatement. B. A significant level of assurance to allow an auditor too detect a material misstatement. C. An absolute level of assurance to allow an auditor to detect a material misstatement. D. A high, but not absolute, level of assurance to allow an auditor to detect a material misstatement.
From the options given below identify type of risk in case auditor unable to provide appropriate audit opinion. a. Audit risk O b. None of the options O c. Control risk O d. Inherent limitation
The combination of inherent risk and control risk constitutes : A. Occurence risk B. Audit risk C. Detection risk D. Combined risk
What are the components of the risk of material misstatement (RMM)? What are the components of the audit risk model?
The risk that material errors will not be detected is directly controllable by the auditor through substantive tests of details and other substantive audit procedures. IS THE STATEMENT TRUE OR FALSE? WHY?