The Audit Team Is Planning to Examine a Sample of Control

question 99

Multiple Choice

The audit team is planning to examine a sample of control policies and procedures.Assume that the audit team establishes a tolerable rate of deviation of 6% and,based on past audits,estimates the expected population deviation rate to be 2%.Which of the following is not true with respect to the impact of the risk of overreliance on sample size?

• A)The risk of overreliance has an inverse impact on sample size.
• B)The risk of overreliance should be assessed at higher levels if the audit team wishes to place lower levels of reliance on internal control.
• C)If the audit team assesses the risk of overreliance at 10%,the resultant sample size would be 88 items.
• D)If the audit team reduced the risk of overreliance from 10% to 5%,the resultant decrease in the sample size would be 39 items.

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Definitions:

Incremental Mind-Set

A belief that abilities and intelligence can be developed through effort, strategies, and persistence.

Entity Mind-Set

The belief that personal qualities are fixed and cannot change, as opposed to a growth mindset that views abilities as developable with effort.

Particular Attribute

A specific quality, trait, or characteristic that distinguishes someone or something from others.

Children's Mind-Set

The attitudes, beliefs, and cognitive approach that children adopt towards learning and problem-solving.