The risk that may result in the auditor's issuing an unqualified opinion on financial statements that are materially misstated is the
A) Risk of assessing control risk too low.
B) Risk of assessing control risk too high.
C) Risk of incorrect acceptance.
D) Risk of incorrect rejection.

Question

Quizplus · Accepted Answer

The risk of incorrect acceptance refers to the risk that the auditor accepts the financial statements as true and free from material misstatements when in fact material misstatements exist. This risk increases the likelihood of the auditor issuing an unqualified opinion on financial statements that are materially misstated. Therefore, choice C is the best answer.

The Risk That May Result in the Auditor's Issuing an Unqualified