The Ultimate Purpose of Control Risk Assessment Is To

question 102

Multiple Choice

The ultimate purpose of control risk assessment is to:

• A) Estimate the overall risk of failing to detect material misstatements.
• B) Decide the nature, timing, and extent of substantive procedures.
• C) Determine the risk of incorrect acceptance.
• D) Determine the probability that errors entered the accounts.

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Definitions:

Mutual Obligation

A reciprocal agreement where each party has duties or responsibilities towards the other, typically seen in contracts or social relationships.

Developing Countries

Nations with a lower standard of living, underdeveloped industrial base, and low Human Development Index relative to other countries.

Ethical Tone

The overall mood or character regarding ethics within an organization, reflecting its commitment to ethical principles in decision-making and actions.

Ethical Standards

Principles that guide behavior and practices in both personal and professional contexts, based on notions of right and wrong.