The Higher the Risk of Material Misstatement,the More Likely the Auditor

question 106

Multiple Choice

The higher the risk of material misstatement,the more likely the auditor is to

• A)gather more relevant and reliable evidence
• B)perform substantive tests at an interim period
• C)increase the extent of control testing
• D)keep the risk of misstatement to an acceptable low level

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Definitions:

Normative Economic Statement

Statements that reflect opinions, beliefs, or values about what the economy should be like, rather than what it actually is.

Inflation Rate

The rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.

Energy Prices

The cost of energy resources, such as oil, gas, and electricity, which can fluctuate based on supply and demand.

Automobile Companies

Businesses involved in the design, development, manufacturing, marketing, and selling of motor vehicles.