If an Audit Team Calculated an Upper Limit Rate of Deviation

question 37

Multiple Choice

If an audit team calculated an upper limit rate of deviation of 5 percent when the tolerable rate of deviation was 4 percent,both at the same risk of overreliance,control risk should be

• A) Assessed at the level associated with the 4 percent tolerable rate of deviation.
• B) Increased and substantive procedures should be adjusted accordingly.
• C) Assessed at the maximum level (100 percent) because the company's performance failed the test.
• D) Decreased and substantive procedures should be adjusted accordingly.

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