The tolerable deviation rate _______.
A)is the maximum rate of deviation from a prescribed control that an auditor is willing to accept and still use the planned assessed level of control risk
B)is the minimum rate of deviation from a prescribed control that an auditor is willing to accept and still use the planned assessed level of control risk
C)refers to the extent that audit fees can go over the roughly agreed amount
D)relates to how many immaterial misstatements the auditor finds

Question

Quizplus · Accepted Answer

The tolerable deviation rate is the maximum rate of deviation from a prescribed control that an auditor is willing to accept and still use the planned assessed level of control risk. This means that if the actual deviation rate is below the tolerable deviation rate, the auditor will likely conclude that the control is functioning effectively and rely on it in the audit. However, if the actual deviation rate exceeds the tolerable deviation rate, the auditor will likely conclude that the control is not functioning effectively and adjust the assessed level of control risk accordingly.

The Tolerable Deviation Rate _______