Inherent Risk and Control Risk Differ from Detection Risk in That

question 53

Multiple Choice

Inherent risk and control risk differ from detection risk in that inherent risk and control risk are:

• A)elements of audit risk whereas detection risk is not.
• B)changed at the auditor's discretion whereas detection risk is not.
• C)considered at the individual account-balance level whereas detection risk is not.
• D)functions of the client and its environment whereas detection risk is not.

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Definitions:

Funding

The act of providing financial resources, usually in the form of money, or other values such as effort or time, to finance a need, program, and project, usually by an organization or government.

Competitors' Products

Goods or services offered by rival businesses in the same industry, which vie for the same customer base or market share.

Business Incubator

An organization designed to help new and startup companies to develop by providing services such as management training or office space.

Venture Capital Company

A firm that invests in startups and small businesses with high growth potential in exchange for equity stakes.