For a given audit risk, the relationship between the risks of material misstatement and detection risk...
For a given audit risk, the relationship between the risks of material misstatement and detection risk is
A. Linear.
B. Inverse.
C. Independent.
D. Equal.
Homework Answers
| The relationship between the risks of material misstatement and detection risk is Inverse. |
| Detection risk is the risk that a material misstatement in an entity's Financial Statements will not be detected. |
| An increase in risks of material misstatement requires an auditor to reduce Detection risk and vice-versa. |
| Option B Inverse is correct |
Add Answer to:
For a given audit risk, the relationship between the risks of
material misstatement and detection risk...
Risk of material misstatement at the assertion level A. refers to risks that are pervasive to...
Risk of material misstatement at the assertion level A. refers to risks that are pervasive to the financial statements as a whole. B. is only relevant to account balances. C. determines the nature, timing, and extent of further audit procedures. D. consists of business risk and inherent risk
The audit process includes Plan the audit to identify and assess risks of material misstatement for...
The audit process includes Plan the audit to identify and assess risks of material misstatement for account balances, classes of transactions, and disclosure. Select one: True False Clear my choice
Summary of the importance of planning an audit to consider the risks of material misstatement in...
Summary of the importance of planning an audit to consider the risks of material misstatement in a set of financial statements. The summary to include at least one reference.
Demonstrate how the auditor assesses the risk of material misstatement. Contrast between Operation Audit, Compliance Aud...
Demonstrate how the auditor assesses the risk of material misstatement. Contrast between Operation Audit, Compliance Audit, Financial Statement Audit. Provide examples from a publicly-traded company.
6. Which of the following statements is not correct? If (a) (b) (c) individual audit risk...
6. Which of the following statements is not correct? If (a) (b) (c) individual audit risk remains the same, detection risk has an inverse relationship to inherent risk and control risk. The auditor may make separate or combined assessments of inherent risk and control risk. Detection risk cannot be changed at the auditor's discretion The greater the inherent and control risks the auditor believes exist, the less detection risk that can be accepted. (d) 7. Inherent risk and control risk...
While assessing the risks of material misstatement, auditors identify risks, relate risk to what could go...
While assessing the risks of material misstatement, auditors identify risks, relate risk to what could go wrong, consider the magnitude of risks, and: _________ The answer can be found in the article covered in class AS2105 Federal Security Laws definition of fact is material when .... Assess the risk of misstatements due to illegal acts. Consider the complexity of the transactions involved. Consider the likelihood that the risks could result in material misstatements. Determine materiality levels.
Inherent risk refers to: A. The possibility that a material misstatement that has occurred will not...
Inherent risk refers to: A. The possibility that a material misstatement that has occurred will not be detected on a timely basis by the company's control system B. The possibility that a material misstatement will occur within the reporting company's accounting information system C. The possibility that a material misstatement will occur in the financial statements D. The possibility that a material misstatement that has occurred will not be caught be the independent auditor's testing
Apart from the Inventory account, which other accounts and assertions are at risk of material misstatement...
Apart from the Inventory account, which other accounts and assertions are at risk of material misstatement for DD, and why? What impact does the control risk assessment have on inherent risk and detection risk? What is the auditor's preliminary assessment of control risk and why? What impact does the control risk assessment (from the previous question) have on inherent risk and detection risk? Which assertion is at risk for the inventory account? Select one: a. rights & obligations b. accuracy,...
principles of auditing chapter 2 QUESTION 11 Audit risk for an individual account consists of business...
principles of auditing
chapter 2
QUESTION 11 Audit risk for an individual account consists of business risk, detection risk, and control risk. True False QUESTION 12 There is an inverse relationship between the effectiveness of an entity's system of internal control and the A. Reliability of financial statements. B. Fairness of management assertions in the financial statements. C. Degree of staff supervision required in the performance of an audit. D. Extent of detailed audit tests required.
The risk of material misstatement due to fraud relating to revenue recognition should be a. given...
The risk of material misstatement due to fraud relating to revenue recognition should be a. given lower priority to the risk of embezzlement. b. ordinarily presumed by the auditor. c. approached in a manner that is identical to control risk assessment. d. assumed to have been considered by the FASB.
The audit process includes Plan the audit to identify and assess risks of material misstatement for account balances, classes of transactions, and disclosure. Select one: True False Clear my choice
6. Which of the following statements is not correct? If (a) (b) (c) individual audit risk remains the same, detection risk has an inverse relationship to inherent risk and control risk. The auditor may make separate or combined assessments of inherent risk and control risk. Detection risk cannot be changed at the auditor's discretion The greater the inherent and control risks the auditor believes exist, the less detection risk that can be accepted. (d) 7. Inherent risk and control risk...
principles of auditing
chapter 2
QUESTION 11 Audit risk for an individual account consists of business risk, detection risk, and control risk. True False QUESTION 12 There is an inverse relationship between the effectiveness of an entity's system of internal control and the A. Reliability of financial statements. B. Fairness of management assertions in the financial statements. C. Degree of staff supervision required in the performance of an audit. D. Extent of detailed audit tests required.
Most questions answered within 3 hours.
-
You are attempting to calculate a firm’s free cash flow to
equity. You know the following...
asked 33 minutes ago -
the following reaction occurs in a balloon containing
N2O2 gas
N2O4(g)=2NO2(g)
will the volume of the...
asked 1 hour ago -
answer the questions throughout this program
public class Day implements Comparable {
Private Boolean atWork;...
asked 1 hour ago -
This is C++ code for parking fee management program
#include <iostream>
#include <iomanip>
using namespace std;...
asked 1 hour ago -
The free energy change for the following reaction at 25 °C, when
[Sn2+] = 1.17 M...
asked 3 hours ago -
An MNE is this kind of industry when competition in one country
is essentially independent of...
asked 4 hours ago -
. For this set of questions, determine what
proportion of a normal distribution is located betweeneach...
asked 5 hours ago -
A college student is employed as a door-to-door newspaper
salesman. Historical data suggests that the student...
asked 6 hours ago -
MATLAB HW 11 problem using Switch Case and Input commands
Write a script file that calculates...
asked 5 hours ago -
Considering gravitational time dilation, calculate the time that
passes in Earth’s surface while 1 hour passes...
asked 6 hours ago -
Minitab Problem: Take the Lake Hume June rainfall data and find
use the processes outlined in...
asked 7 hours ago -
X Company is trying to decide whether to continue using old
equipment to make Product A...
asked 7 hours ago