The likelihood of assessing control risk too high is the risk that the sample se
ID: 374528 • Letter: T
Question
The likelihood of assessing control risk too high is the risk that the sample selected to test controls: (a) Contains misstatements that could be material to the financial 24. statements when aggregated with misstatements in other account balances or transactions classes. Does not support the auditor's planned assessed level of control risk when the true operating effectiveness of the control justifies such an assessment. Does not support the tolerable misstatement for some or all of management's assertions. Contains proportionately fewer d than exist in the balance or class as a whole. (b) (c) (d)Explanation / Answer
Answer is option b i. e does not support the auditors planned assessed level of control risk when the true operating effectiveness of internal control justifies such an assessment.
Explanation:
Risk of accessing control risk too high comprises of risk where the assessed level of control risk based on the sample is greater than the true operating effectiveness of the control. In this case the auditor concludes that the system operates less effectively than it actually does.
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