Which of the following risk types increase when an auditor performs substantive analytical audit procedures for financial statement accounts at an interim date?a. Inherent.b. Control.c. Detection.d. Sampling.

Which of the following risk types increase when an auditor performs substantive analytical audit procedures for financial statement accounts at an interim date?a. Inherent.b. Control.c. Detection.d. Sampling.

Auditing: A Risk Based-Approach to Conducting a Quality Audit

10th Edition

ISBN:9781305080577

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

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

Chapter6: A Framework For Audit Evidence

Section: Chapter Questions

Problem 9TFQ

See similar textbooks

Related questions

Q: ltimate purpose of assessing control risk is to contribute to the auditor’s evaluation of the: a.…

A: Control Risk: It is also known as internal control risk; this risk arises due to the inefficiency…

Q: the auditor is planning to use accounts payable confirmations when auditing the client's accounts…

A: Accounts payable confirmations refer to a process used by auditors to verify the accuracy and…

Q: The objective of dual-purpose tests is to: A. Test internal controls as well as transactions and…

Q: An auditor simply compares a current year balance with the prior year balance in order to help…

A: To identify trends, analysing the data of just one year and compare it with current year will not be…

Q: Tests of controls in a GAAS audit are required fora. Obtaining evidence about the financial…

A: Formal criteria used by auditors when carrying out audits of corporate financial reports are a…

Q: In the audit of accounts payable, an auditor’s procedures will most likely focusprimarily on…

A: 1. Existence or occurrence - The best way to establish existence and ownership of investments is…

Q: In auditing, ____________ is the process of identifying and assessing the risks of material…

A: Auditing refers to an official inspection of the financial information of an organization. Auditing…

Q: Which two of the following statements regarding the use of analytical procedures of the audit are…

A: Analytical procedures are done by the auditor at the planning stage of audit to assess different…

Q: Tests of controls in a GAAS audit are required fora. Obtaining evidence about the financial…

A: Test of controls is the process of the audit to check the effectiveness of the controls by a client…

Question

Definition Definition Methods and techniques used by the auditor to gather the appropriate evidence so that a true and fair judgment can be made on the quality of the financial statements of the client. Audit procedures are developed after determining audit objectives, scope, approach, and risk assessment.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Definition

VIEW

Step 2: Justification

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Which is not a Risk Assessment Procedure? a. Ratio Analysis b. Observation of Activities c. Account Receivable confirmations d. Inspection of Documents e. Inquiry of Internal Auditors
Once risks are identified, auditors assess the risk of material misstatement at the _______ level for these significant classes of transactions and account balances. A. disclosure B. financial statement C. relevant assertion level D. account
During financial statement audit, auditors seek to restrict which type of risk? Control risk, Detection risk, Inherent risk, or Account risk
For a particular account balance assertion, the auditor is most likely to be able to avoid substantive test of details with which of these sets of risk assessments? Results of analytical procedures Unexpected Expected Expected Unexpected Inherent Maximum Maximum A. B. C. Low D. Low a. A. b. B. c. C. d. D. Control Maximum Maximum Low Low
tch the type of risk with the related definition.A. Detection riskB. Control riskC. Inherent riskD. Audit risk___ 1. The probability that an auditor will give an inappropriate opinion on financial statements.___ 2. The probability that audit procedures will fail to produce evidence of material misstatements.___ 3. The probability that the client's internal control policies and procedures will fail to detect material misstatements if they have entered the accounting system.___ 4. The probability that material misstatements have occurred in transactions entering the accounting system.
What does an operational audit attempt to measure? Does an operational audit involve more or fewer subjective judgments than a compliance audit or an audit of financial statements? Explain. To whom is the report usually directed after completion of an operational audit?
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 terms best describes the risk that audit procedures will fail to detect material misstatements? a. Control risk. b. Inherent risk. c. Detection risk. d. Audit risk.
In auditing the accrued liabilities account on the Balance Sheet, an auditor’s procedures most likely would focus primarily on management’s assertion ofa. Existence or occurrence.b. Completeness.c. Presentation and disclosure.d. Valuation or allocation.
Analytical procedures consist of evaluations of financial informationmade by a study of plausible relationships among both financial and nonfinancial data.They range from simple comparisons to the use of complex models involving manyrelationships and elements of data. They involve comparisons of recorded amounts, orratios developed from recorded amounts, to expectations developed by the auditors.a. Describe the broad purposes of analytical procedures.b. When are analytical procedures required during an audit? Explain why auditors useanalytical procedures extensively in all parts of the audit.c. Describe the factors that influence the extent to which an auditor will use the resultsof analytical procedures to reduce detailed tests in meeting audit objectives.*
Which of the following statements is correct concerning analytical procedures used in planning an audit engagement?a. They often replace the tests of controls that are performed to assess control risk.b. They typically use financial and nonfinancial data aggregated at a high level.c. They usually involve the comparison of assertions developed by management to ratios calculated by an auditor.d. They are often used to develop an auditor’s preliminary judgment about materiality.
The audit risk model includes the four risks listed below. Match the type of risk with the related definition.A. Detection riskB. Control riskC. Inherent riskD. Audit risk___ 1. The probability that an auditor will give an inappropriate opinion on financial statements.___ 2. The probability that audit procedures will fail to produce evidence of material misstatements.___ 3. The probability that the client's internal control policies and procedures will fail to detect material misstatements if they have entered the accounting system.___ 4. The probability that material misstatements have occurred in transactions entering the accounting system.