Which of the Following Is a Correct Statement

question 62

Multiple Choice

Which of the following is a correct statement?

• A) When internal controls are effective, control risk can be reduced, and therefore the auditor will decrease the ARIA.
• B) There is a direct relationship between ARIA and the required sample size.
• C) A lower control risk requires a lower ARO in testing the controls.
• D) ARO measures the auditor's desired assurance for an account balance.

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Definitions:

Achievable Goals

Objectives that are realistic and attainable within a specific timeframe, taking into account the available resources and constraints.

Individual Responsibility

The obligation of a person to account for their activities and accept the consequences of their actions.

Feedback

The information provided about the result of an action or process, used as a basis for improvement.

Managerial Implications

Refers to the practical outcomes or effects of management theories, strategies, or decisions on organizational operations.