Matching
Match the definitions provided below with the correct term.
Premises:
a measure of the risk that the auditor will not detect a misstatement that exists in an assertion that could be material
the materiality allocated to any given account balance
the risk that the auditor or audit firm will suffer harm because of a client relationship even though the audit report rendered for the client was correct
a measure of the auditor's assessment of the likelihood that misstatements exceeding a tolerable amount in a segment will not be prevented or detected by the client's internal controls
the maximum amount by which the auditor believes that the statements could be misstated and still not affect the economic decisions of users
a measure of how much risk the auditor is willing to take that the financial statements may be materially misstated after the audit is completed and an unqualified audit opinion has been issued
Responses:
planned detection risk
preliminary judgement about materiality
audit assurance
tolerable error
control risk
acceptable audit risk
business risk
inherent risk
materiality
Correct Answer:
Premises:
Responses:
planned detection risk
preliminary judgement about materiality
audit assurance
tolerable error
control risk
acceptable audit risk
business risk
inherent risk
materiality
Premises:
planned detection risk
preliminary judgement about materiality
audit assurance
tolerable error
control risk
acceptable audit risk
business risk
inherent risk
materiality
Responses:
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