chap 12 decide planned detection risk and design substantive tests

Question 1

the appropriate level of detection risk for each ___ ___ audit objective is decided using the audit risk model

Answer 1

balance related

Question 2

for the audit of the FSs, the auditor uses the control risk assessment and the results of tests of controls to determine what 2 things?

Answer 2

1. the planned detection risk 2. the related substantive tests

Question 3

how does the auditor use the control risk assessment and the results tests of controls to determine planned detection risk and the related substantive tests for the audit of the FSs?

Answer 3

by linking the control risk assessments to the balance related audit objectives for the accounts affected by the major transaction types and to the 4 presentation and disclosure objectives

Question 4

what 2 activities is sufficient for the audit of internal control over financial reporting?

Answer 4

1. assess control risk for each related audit objective 2. support control risk assessments with tests of controls