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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