Question: What is detection risk, and how does the definition relate to inherent risk and control risk?

What is detection risk, and how does the definition relate to inherent risk and control risk?

Step by Step Solution

★★★★★

3.37 Rating (166 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

Detection risk of an audit is the risk that an auditor wil... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

395-B-A-A-A-N (3931).docx

120 KBs Word File

Students Have Also Explored These Related Auditing Questions!

Q:

What entity creates the auditing standards that are followed in the audit of a nonpublic company?

Q:

Under SOX, who selects and hires the auditor?

Q:

What is the relationship between the AICPA Code of Conduct and the codes of the various states?

Q:

MULTIPLE-CHOICE QUESTIONS 1. Which of the following statements is true regarding the concept of materiality? a. Materiality is the magnitude of an omission or misstatement of accounting information...

Q:

Which of the following best describes the main reason that independent auditors report on a company's financial statements? Management fraud may exist within the company and it is likely that the...

Q:

10 On September 3, 20X1. Larkin, CPA was engaged to audit the financial statements of Precious Metals Co (PM), for the year ended October 31, 20X1 PM purchases precious metals at wholesale prices and...

Q:

ckboard XCOD Help Center Question 54 TPUNIC XFollowing are three companies under audit where the audit risk model is used by Mr. Mohammed, an independent auditor, for planning audit evidence...

Q:

kboard XCO X Company A Risks: Acceptable audit risk 5% Inherent risk 40% Control risk 60% Planned detection risk Company B Risks: Acceptable audit risk 5% Inherent risk 40% Control risk 50% Planned...

Q:

Please give the reason,thank you Case On September 3, 20x1, Larkin, CPA, was engaged to audit the financial statements of Precious Metals Co. (PM), for the year ended October 31, 20X1. PM purchases...

Q:

The risk of material misstatement is composed of which audit risk components? a. Inherent risk and control risk. b. Control risk and detection risk. c. Inherent risk and detection risk. d. Inherent...

Q:

Do you think food aid is a good policy for the United States to adopt in regards to foreign countries? Consider the economic, ecological, and social impacts and address these in your answer.

Q:

Three adjacent faces (that all share a corner) of a plastic cube of index of refraction n are painted black. A clear spot at the painted corner serves as a source of diverging rays when light comes...

Q:

3. Identify three situations in each of the following places where simulation could be a useful tool to study the problem: a. A five-star hotel b. The Bangalore Dairy (that processes and packages...

Q:

Describe the three purposes of the performance appraisal.

Q:

To test the operating effectiveness of a control, an audit team might use a combination of each of the following tests except for: a. Inquiry of client personnel. b. Observation of company...

Q:

To test the operating effectiveness of a control, an audit team might use a combination of each of the following tests except for: a. Inquiry of client personnel. b. Observation of company...

Q:

Which of the following is a preventive control? a. Reconciliation of a bank account. b. Recalculation of a sample of payroll entries by internal auditors. c. Separation of duties between the payroll...

Q:

You are in charge of conducting an analysis for your organization to see if there is a difference between manager and individual contributor employee satisfaction. Your coworker has already collected...

Q:

b. What percentage of 18 to 24 year olds smoke? [3 marks] ANSWER (Percentage, 2 decimal places): c. If a student is 25 years or older, what is the probability he/she is a non-smoker? [3] ANSWER (4...

Q:

Acort Industries has 10 million shares outstanding and a current share price of $40 per share. It also has long-term debt outstanding. This debt is risk free, is four years away from maturity, has...