a) For each of the following, identify the component of the audit risk model that is...

 

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a) For each of the following, identify the component of the audit risk model that is affected and if it increases or decreases the related risk. (12 marks) Type of risk affected Change to the level of risk i) The audit plan and all working papers are carefully reviewed by the audit partner responsible for the engagement. Ins ii) The client's industry is well-established and operations are all located within politically stable regions. iii) The client's financial statements will be read and relied upon by a large number of stakeholders. iv) The client recently implemented a new accounting information system that has not yet been tested thoroughly. v) The client has no related party transactions. vi) The engagement team is comprised of inexperienced auditors who are tasked with the bulk of the field work. a) For each of the following, identify the component of the audit risk model that is affected and if it increases or decreases the related risk. (12 marks) Type of risk affected Change to the level of risk i) The audit plan and all working papers are carefully reviewed by the audit partner responsible for the engagement. Ins ii) The client's industry is well-established and operations are all located within politically stable regions. iii) The client's financial statements will be read and relied upon by a large number of stakeholders. iv) The client recently implemented a new accounting information system that has not yet been tested thoroughly. v) The client has no related party transactions. vi) The engagement team is comprised of inexperienced auditors who are tasked with the bulk of the field work.

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Answer 1 The risk is Detection Risk It decreases risk 2 ... View the full answer