If from Last Year to the Current Year's Audit,inherent Risk

question 13

Multiple Choice

If from last year to the current year's audit,inherent risk has stayed constant but control risk is higher (it is more likely that controls do not detect material errors) ,what is the likely effect on detection risk?

• A)Detection risk will increase.
• B)Detection risk will decrease.
• C)Detection risk will stay the same.
• D)Detection risk will need less documentation.

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Definitions:

Incremental Intelligence

The belief that intelligence can be developed through hard work, strategies, and learning from mistakes rather than being a fixed trait.

Componential Intelligence

Part of Sternberg's Triarchic Theory of Intelligence, focusing on the analytical aspects of intelligence, which involve problem-solving, logical reasoning, and the analysis of information.

Experiential Intelligence

The ability to adapt to new situations and learn from experience.

Componential

This term is related to breakdown into components, usually used in the context of analysis or theory that emphasizes the discrete elements that make up a whole.