As the risk of material misstatement increases, detection risk should:
A)medium increase.
B)decrease.
C)stay the same.
D)Is indeterminate.

Question

Quizplus · Accepted Answer

As the risk of material misstatement increases, detection risk should decrease. This is because detection risk is the risk that the auditor will not detect a material misstatement, and if the risk of material misstatement is higher, the auditor needs to increase their level of assurance by decreasing the detection risk.

As the Risk of Material Misstatement Increases, Detection Risk Should