The exception rate the auditor will permit in the population and still be willing to reduce the assessed level of control risk is called the:
A)tolerable exception rate.
B)estimated population exception rate.
C)acceptable risk of overreliance.
D)sample exception rate.

Question

Quizplus · Accepted Answer

The tolerable exception rate is the maximum rate of exceptions that an auditor is willing to accept in the population and still reduce the assessed level of control risk. This rate is determined based on the auditors' judgment and assessment of the risk of material misstatement in the financial statements. The other options, estimated population exception rate, acceptable risk of overreliance, and sample exception rate, are not specifically related to the auditor's willingness to reduce the assessed level of control risk.

The Exception Rate the Auditor Will Permit in the Population