Which sentence below is true about audit risk:  A. Audit risk is the risk that a company may hire an incompetent auditor. B. Audit risk can be completely eliminated through appropriate sampling of transactions. C. Audit is what creates the demand for an audit. D. Audit risk is the risk that a "clean" opinion will be issued when, in reality, the financial statements are materially misstated..

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
Chapter7: Planning The Audit: Identifying, And Responding To The Risk Of Material Misstatement
Section: Chapter Questions
Problem 12TFQ
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Which sentence below is true about audit risk: 

A.

Audit risk is the risk that a company may hire an incompetent auditor.

B.

Audit risk can be completely eliminated through appropriate sampling of transactions.

C.

Audit is what creates the demand for an audit.

D.

Audit risk is the risk that a "clean" opinion will be issued when, in reality, the financial statements are materially misstated..

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