Client risk as defined in the text is:
A)the auditor's risk of loss from events arising in connection with financial statements audited and reported upon.
B)the overall risk of material misstatement.
C)the risk that audit procedures will fail to detect material misstatements.
D)the risk of the entity's financial failure.

Question

Quizplus · Accepted Answer

Client risk is defined as the overall risk of material misstatement in the financial statements audited and reported upon. It includes inherent risk, control risk, and detection risk. It is not specific to the auditor's risk of loss or the risk of financial failure of the entity.

Client Risk as Defined in the Text Is