When the Auditor Concludes That a Control Is Functioning Properly

question 60

Multiple Choice

When the auditor concludes that a control is functioning properly when,in fact,it is not,the auditor has committed the:

• A)Risk of underreliance.
• B)Risk of overreliance.
• C)Risk of incorrect acceptance.
• D)Risk of incorrect rejection.

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Definitions:

Industry

The segment of the economy concerned with production, processing, and preparation of goods and services, often categorized into sectors like manufacturing, services, and agriculture.

Local Monopoly

A situation where a single firm dominates the market within a specific geographic area, limiting competition.

Neighborhood

A geographical area or community within a city or town, characterized by shared features or common identity among its residents.

Industry Standard

Widely accepted criteria, guidelines, or practices that are used within a specific industry.