Question: experts only please. In connection with the preliminary planning for the audit of XYZ Company, the auditors have determined that they are willing to accept

experts only please.
In connection with the preliminary planning for the audit of XYZ Company, the auditors have determined that they are willing to accept an overall risk of material misstatement (audit risk) of 8% for the customer receivables account. Further, they have determined that overall inherent risk is 75%. In addition, they believe that the internal control system will detect material misstatements 80% of the time and fail to detect 20% of the time. Based on these facts, (and using the audit risk equation) what percentage amount should the auditors set for detection risk? Type your answer without a decimal point. For example - type XX and NOT .XX. Round to the nearest whole percent
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
