An Auditor Who Increases the Planned Assessed Level of Control

question 121

Multiple Choice

An auditor who increases the planned assessed level of control risk because certain control activities were determined to be ineffective would most likely increase the

• A) Extent of substantive tests of details.
• B) Level of inherent risk.
• C) Extent of tests of controls.
• D) Level of detection risk.

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Definitions:

Rescission

The legal nullification of a contract, returning all parties involved to their original positions before the contract was made.

Breach of Duty

Failure to meet a standard of care legally owed to someone, resulting in harm or damage.

Negotiation

The process by which parties discuss and arrive at a mutually acceptable agreement.

Transferee

A person or entity that receives property, rights, or interest from another through a legal transfer process.