Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss . However, none of the below factors affects the assessment of control risk at a higher level: 1) Lack of expertise to deal with changes in the industry 2) Existence of significant supply chain risks 3) The maturity stage of industry 4)Legal exposure To choose: Whether the statement is true or false

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Answer 1

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Chapter 7, Problem 8TFQ

To determine

Introduction: Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss. However, none of the below factors affects the assessment of control risk at a higher level:

1) Lack of expertise to deal with changes in the industry

2) Existence of significant supply chain risks

3) The maturity stage of industry

4)Legal exposure

To choose:Whether the statement is true or false

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Answer 2

Question

Chapter 7, Problem 8TFQ

To determine

Introduction: Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss. However, none of the below factors affects the assessment of control risk at a higher level:

1) Lack of expertise to deal with changes in the industry

2) Existence of significant supply chain risks

3) The maturity stage of industry

4)Legal exposure

To choose:Whether the statement is true or false

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 3

Question

Chapter 7, Problem 8TFQ

To determine

Introduction: Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss. However, none of the below factors affects the assessment of control risk at a higher level:

1) Lack of expertise to deal with changes in the industry

2) Existence of significant supply chain risks

3) The maturity stage of industry

4)Legal exposure

To choose:Whether the statement is true or false

Expert Solution & Answer

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Answer 4

Question

Chapter 7, Problem 8TFQ

To determine

Introduction: Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss. However, none of the below factors affects the assessment of control risk at a higher level:

1) Lack of expertise to deal with changes in the industry

2) Existence of significant supply chain risks

3) The maturity stage of industry

4)Legal exposure

To choose:Whether the statement is true or false

Expert Solution & Answer

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Answer 5

Chapter 7, Problem 8TFQ

To determine

Introduction: Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss. However, none of the below factors affects the assessment of control risk at a higher level:

1) Lack of expertise to deal with changes in the industry

2) Existence of significant supply chain risks

3) The maturity stage of industry

4)Legal exposure

To choose:Whether the statement is true or false

Answer 6

Chapter 7, Problem 8TFQ

To determine

Introduction: Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss. However, none of the below factors affects the assessment of control risk at a higher level:

1) Lack of expertise to deal with changes in the industry

2) Existence of significant supply chain risks

3) The maturity stage of industry

4)Legal exposure

To choose:Whether the statement is true or false

Answer 7

Chapter 7, Problem 8TFQ

To determine

Introduction: Control risk is a risk that there is a possibility of material misstatement of financial statements due to poor internal check and control systems in a business. When the internal controls are weak, there are risks of unaccounted losses and hence, misstatement of profit and loss. However, none of the below factors affects the assessment of control risk at a higher level:

1) Lack of expertise to deal with changes in the industry

2) Existence of significant supply chain risks

3) The maturity stage of industry

4)Legal exposure

To choose:Whether the statement is true or false

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 7 - Prob. 1TFQ Ch. 7 - Prob. 2TFQ Ch. 7 - Prob. 3TFQ Ch. 7 - Prob. 4TFQ Ch. 7 - Prob. 5TFQ Ch. 7 - Prob. 6TFQ Ch. 7 - Prob. 7TFQ Ch. 7 - Prob. 8TFQ Ch. 7 - Prob. 9TFQ Ch. 7 - Prob. 10TFQ

Solution Summary: The author explains that control risk is a risk of material misstatement of financial statements due to poor internal check and control systems.

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Chapter 7 Solutions