When Using Sampling for Tests of Controls,which of the Following

question 20

Multiple Choice

When using sampling for tests of controls,which of the following audit consequences may follow?

• A)If sample results indicate that the control is operating effectively,but in fact it is not,control risk will be assessed too low.
• B)If sample results indicate that the control is operating effectively,but in fact it is not,control risk will be assessed too high.
• C)If sample results indicate that the control is not operating effectively,but in fact it is operating effectively,the audit is likely to be faulty because of reduced substantive tests.
• D)If sample results indicate that the control is not operating effectively,but in fact it is operating effectively,control risk will be assessed too low.

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Definitions:

Right of Way

A legal right to pass through property owned by another, typically referring to roads or paths.

Parcel Identification Number

A unique numerical or alphanumeric code assigned to a parcel of land for identification and administrative purposes.

Electronic Registration System

A digital system used to record and manage the ownership and transactions of securities or properties.

Right of Way of Necessity

A legal grant allowing one to cross land owned by another, typically when it's essential for access to one's own land and no alternative route exists.