Question: wud tor must understand audit risk and its components when planning a financial report audit him of Thomas & Fine evaluates the risk of material

wud tor must understand audit risk and its components when planning a financial report audit him of Thomas & Fine evaluates the risk of material misstatement by disaggregating it into

its three components: inherent risk, control risk and detection risk.

REQUIRED

For each situation in the table below, select the component of audit risk that is most directly illustrated. The components of audit risk may be used once, more than once, or not at all.

Finish attempt

Component of audit risk

Situation

Segregation of duties is inadequate
Confirmation of receivables by an auditor fails to detect a material misstatement
Cash payments have occurred without proper approval

\(d) A client, Expo Ltd, has a large cash balance

(e) A necessary substantive audit procedure is omitted

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