The risk that an auditor's procedures will lead to the conclusion that a material misstatement does not exist in an account balance when, in fact, such a misstatement does exist is:
A)audit risk.
B)detection risk.
C)control risk.
D)inherent risk

Question

Quizplus · Accepted Answer

This is a description of detection risk, which is the risk that the auditor's procedures will not detect a material misstatement in an account balance or class of transactions. The other options are not applicable to this specific risk. Control risk is the risk that a material misstatement could occur in an account balance or class of transactions due to a breakdown in the entity's internal control. Inherent risk is the risk that a material misstatement could occur in an account balance or class of transactions due to the nature of the account or transaction itself. Audit risk is the risk that the auditor will issue an incorrect opinion on the financial statements.

The Risk That an Auditor's Procedures Will Lead to the Conclusion