Question: Explain the difference between the two types of sampling risk for substantive testing: the risk that the auditor concludes that a material misstatement does not

Explain the difference between the two types of sampling risk for substantive testing: the risk that the auditor concludes that a material misstatement does not exist when it does and the risk that the auditor concludes that a material misstatement exists when it does not. What are the errors’ different implications for the audit? Which is the more serious risk? Explain.

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In substantive testing in auditing there are two types of sampling risk 1 the risk of incorrect acceptance and 2 the risk of incorrect rejection These ... View full answer

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