For an Attributes Sampling Plan, the Tolerable Deviation Rate Is

question 30

Multiple Choice

For an attributes sampling plan, the tolerable deviation rate is 4%, the computed upper deviation rate is 7%, the sample deviation rate is 3%, and the risk of assessing control risk too low is 5%. Which of the following is true?

• A)The auditor must increase control risk because the risk of assessing control risk too low is greater than the tolerable deviation rate.
• B)The auditor is likely to increase control risk because the risk of assessing control risk too low is greater than the tolerable deviation rate.
• C)The auditor must increase control risk because the computed upper deviation rate is greater than the tolerable deviation rate.
• D)The auditor is likely to increase control risk because the computed upper deviation rate is greater than the tolerable deviation rate.

---

Definitions:

Financial Expertise

The knowledge and skill in managing finances, including investments, budgeting, and financial planning.

Operating Experience

Accumulated knowledge and skills from directly managing or running business operations.

Intellectual Honesty

Commitment to truth and objectivity in one’s reasoning and arguments, avoiding bias or misrepresentation of facts.

Owning Resources

Refers to having legal possession or control over resources such as property, intellectual property, or financial assets.