Matching
Match the terms below (a-h)with the definitions provided below (1-8):
Premises:
a measure of the risk that audit evidence for a segment will fail to detect misstatements exceeding the performance materiality amount
This term is synonymous with acceptable audit risk.
a measure of the auditor's assessment of the likelihood that there are material misstatements before considering the effectiveness of internal control
the maximum amount by which the auditor believes that the statements could be misstated and still not affect the decisions of reasonable users
a measure of how much risk the auditor is willing to take that the financial statements may be materially misstated after the audit is completed and an unqualified audit opinion has been issued
the magnitude of an omission or misstatement of accounting information that makes it probable that the judgment of a reasonable person would have been changed
the materiality allocated to any given account balance
a measure of the auditor's assessment of the likelihood that misstatements exceeding a performance materiality in a segment will not be prevented or detected by the client's internal controls
Responses:
acceptable audit risk
planned detection risk
audit assurance
inherent risk
materiality
control risk
preliminary judgment about materiality
performance materiality level
Correct Answer:
Premises:
Responses:
a measure of the risk that audit evidence for a segment will fail to detect misstatements exceeding the performance materiality amount
This term is synonymous with acceptable audit risk.
a measure of the auditor's assessment of the likelihood that there are material misstatements before considering the effectiveness of internal control
the maximum amount by which the auditor believes that the statements could be misstated and still not affect the decisions of reasonable users
a measure of how much risk the auditor is willing to take that the financial statements may be materially misstated after the audit is completed and an unqualified audit opinion has been issued
the magnitude of an omission or misstatement of accounting information that makes it probable that the judgment of a reasonable person would have been changed
the materiality allocated to any given account balance
a measure of the auditor's assessment of the likelihood that misstatements exceeding a performance materiality in a segment will not be prevented or detected by the client's internal controls
Premises:
a measure of the risk that audit evidence for a segment will fail to detect misstatements exceeding the performance materiality amount
This term is synonymous with acceptable audit risk.
a measure of the auditor's assessment of the likelihood that there are material misstatements before considering the effectiveness of internal control
the maximum amount by which the auditor believes that the statements could be misstated and still not affect the decisions of reasonable users
a measure of how much risk the auditor is willing to take that the financial statements may be materially misstated after the audit is completed and an unqualified audit opinion has been issued
the magnitude of an omission or misstatement of accounting information that makes it probable that the judgment of a reasonable person would have been changed
the materiality allocated to any given account balance
a measure of the auditor's assessment of the likelihood that misstatements exceeding a performance materiality in a segment will not be prevented or detected by the client's internal controls
Responses:
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