Risk in Auditing Means That the Auditor Accepts Some Level

question 24

Multiple Choice

Risk in auditing means that the auditor accepts some level of uncertainty in performing the audit function. An effective auditor will

• A) take any means available to reduce the risk to the lowest possible level.
• B) set the risk level between 5% and 10%.
• C) perform the audit procedures first and quantitatively set the risk level before forming an opinion and writing the report.
• D) recognize that risks exist and deal with those risks in an appropriate manner.

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Definitions:

Role Confusion

A situation in which individuals are unsure about their identity or role within a specific context, often occurring during adolescence as described by Erik Erikson's stages of psychosocial development.

Identity

The distinguishing character or personality of an individual; how one sees oneself in relation to groups, society, and as an individual.

Basic Trust

An essential belief in the reliability and predictability of the world, typically developed during infancy.

Autonomy

The capacity to make an informed, uncoerced decision or the quality of being independent and self-directed.