Auditing: A Risk Based-Approach (MindTap Course List)
11th Edition
ISBN: 9781337619455
Author: Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher: Cengage Learning
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Question
Chapter 8, Problem 6RQSC
To determine
Introduction: Internal control risks are risks which affects the effectiveness and controllability of the internal controls. The book value risks are those risks which affect the status of the conclusion of the account.
Requirement 1
Define the incorrect acceptance and rejection risk of internal control reliability and book value.
To determine
Introduction: Internal control risks are risks which affects the effectiveness and controllability of the internal controls. The book value risks are those risks which affect the status of the conclusion of the account.
Requirement 2
Most concerning risk for the auditor among four.
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Students have asked these similar questions
Which of the following risks does the auditor least control? a. inherent risk b. control risk c. detection risk d. all are equally controllable
Which of the following is not a principle relating to risk assessment?
a.
Identifies and analyses risks and respond to changes
b.
Designing the information systems
c.
Specifies objectives with sufficient clarity
d.
Considers the potential for fraud in assessing risks
Which of the following statements is correct regarding detection risk and the audit risk model?
OA. The two components of detection risk are test of details risk and inherent risk.
B. Detection risk is equal to risk of material misstatement divided by audit risk.
OC. There is an inverse relationship between the risk of material misstatement and detection risk.
OD. There is a direct relationship between control risk and detection risk.
Chapter 8 Solutions
Auditing: A Risk Based-Approach (MindTap Course List)
Ch. 8 - Prob. 1CYBKCh. 8 - Prob. 2CYBKCh. 8 - Prob. 3CYBKCh. 8 - Prob. 4CYBKCh. 8 - Prob. 5CYBKCh. 8 - Prob. 6CYBKCh. 8 - Prob. 7CYBKCh. 8 - Prob. 8CYBKCh. 8 - Prob. 9CYBKCh. 8 - Prob. 10CYBK
Ch. 8 - Prob. 11CYBKCh. 8 - Prob. 12CYBKCh. 8 - Prob. 13CYBKCh. 8 - Prob. 14CYBKCh. 8 - Prob. 15CYBKCh. 8 - Prob. 16CYBKCh. 8 - Prob. 17CYBKCh. 8 - Prob. 18CYBKCh. 8 - Refer to Exhibit 8.6. Assume a 5% risk of...Ch. 8 - Prob. 21CYBKCh. 8 - Prob. 22CYBKCh. 8 - Prob. 23CYBKCh. 8 - Prob. 24CYBKCh. 8 - Prob. 25CYBKCh. 8 - Prob. 26CYBKCh. 8 - Prob. 27CYBKCh. 8 - Prob. 28CYBKCh. 8 - Prob. 29CYBKCh. 8 - Prob. 30CYBKCh. 8 - Prob. 31CYBKCh. 8 - Prob. 32CYBKCh. 8 - Prob. 33CYBKCh. 8 - Prob. 34CYBKCh. 8 - Prob. 35CYBKCh. 8 - Prob. 36CYBKCh. 8 - Prob. 37CYBKCh. 8 - Prob. 38CYBKCh. 8 - Prob. 39CYBKCh. 8 - Prob. 1RQSCCh. 8 - Prob. 3RQSCCh. 8 - Prob. 4RQSCCh. 8 - Prob. 5RQSCCh. 8 - Prob. 6RQSCCh. 8 - Prob. 7RQSCCh. 8 - Prob. 8RQSCCh. 8 - Prob. 9RQSCCh. 8 - Prob. 10RQSCCh. 8 - Prob. 11RQSCCh. 8 - Prob. 12RQSCCh. 8 - Prob. 13RQSCCh. 8 - Prob. 14RQSCCh. 8 - Prob. 15RQSCCh. 8 - Prob. 16RQSCCh. 8 - Prob. 17RQSCCh. 8 - Prob. 18RQSCCh. 8 - Prob. 19RQSCCh. 8 - What is stratification? Distinguish between...Ch. 8 - Prob. 21RQSCCh. 8 - Prob. 22RQSCCh. 8 - Prob. 23RQSCCh. 8 - Prob. 24RQSCCh. 8 - Prob. 25RQSCCh. 8 - Prob. 26RQSCCh. 8 - Prob. 27RQSCCh. 8 - Prob. 28RQSCCh. 8 - Prob. 29RQSCCh. 8 - Prob. 30RQSCCh. 8 - Prob. 31RQSCCh. 8 - Prob. 32RQSCCh. 8 - Prob. 33RQSCCh. 8 - Prob. 36RQSCCh. 8 - Prob. 37RQSC
Knowledge Booster
Similar questions
- How can an auditor reduce a client’s inherent risk?arrow_forwardThe audit risk model is the foundation of audit practice. True Falsearrow_forwardIf the auditor is unable to rely on the IT general controls or application controls of a client, they will assess audit risk as high. control risk as low. O inherent risk as high. O control risk as high.arrow_forward
- What is risk of incorrect acceptance? A. The risk that the auditor concludes that a material misstatement exists when it does not exist. B. The risk that the auditor concludes that a material misstatement does not exist when it actually does not. C. The risk that the auditor concludes that a material misstatement does not exist when it does exist. D. The risk that the auditor concludes that a material misstatement exists when it actually does.arrow_forwardThis term is synonymous with acceptable audit risk. O Audit assurance O Tolerable misstatement O Detection risk O Materialityarrow_forwardDistinguish between errors and irregularities. Which do you think concern auditors the most?arrow_forward
- What does an auditor's assessment of Detection Risk determine?arrow_forwardWhat are the components of the risk of material misstatement (RMM)? What are the components of the audit risk model?arrow_forwardExplain why auditing is important in lowering the risk associated with information.arrow_forward
- In obtaining audit evidence, the auditor should use professional judgment to assess the risk of material misstatement (which includes inherent and control risk) and design further audit procedures to ensure this risk is increased to an acceptably high level. TRUE OR FALSE? WHY?arrow_forwardThe risk of material misstatement is O inherent risk * detection risk. O audit risk * inherent risk. O inherent risk * control risk. O control risk * detection risk.arrow_forwardWhich of the following is driving the need for assurance maps?a. Risk managers.Incorrect. b. Board members. c. Internal auditors. d. Compliance practitioners.arrow_forward
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