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:

Not-for-profit Organization

An entity that operates for purposes other than generating profit, focusing on social, educational, charitable, or other activities.

Contribution Receivable

An amount pledged to be paid to a company or organization as a donation or investment, but which has not yet been received.

Ultimate Collection

A term typically referring to the most complete or finest selection of items in a particular category or series.

Government Grants

Financial assistance given by the government to individuals, organizations, or companies in support of activities that are considered beneficial to the public interest.