In addition to representing an assessment of whether a client's internal control is effective for preventing or detecting misstatements,control risk also represents the
A)reliability of management in preventing or detecting fraud.
B)auditor's intention to rely on internal controls.
C)likelihood that the auditor will detect illegal acts.
D)possibility of collusion occurring between two employees.

Question

Quizplus · Accepted Answer

Control risk, in the context of an audit, refers to the risk that a misstatement that could occur in an account balance or class of transactions and that could be material, either individually or when aggregated with misstatements in other balances or classes, will not be prevented or detected (and corrected) on a timely basis by the entity's internal control. The auditor's intention to rely on internal controls directly influences the assessment of control risk; if the auditor plans to rely more on the internal controls, they might assess control risk as lower, assuming the controls are effective.

In Addition to Representing an Assessment of Whether a Client's