The amount by which a projected likely misstatement differs from an actual misstatement is usually the result of ________.
A)a misunderstanding of accounting principles
B)sampling error
C)management override of an internal control procedure
D)risk of incorrect acceptance

Question

Quizplus · Accepted Answer

The difference between a projected likely misstatement and an actual misstatement is typically due to sampling error, which is the result of statistical variation between the sample and the population being audited. A misunderstanding of accounting principles or management override of a control procedure could result in misstatements, but would not explain the difference between projected and actual misstatements. Risk of incorrect acceptance is a term used in the audit risk model, and is not directly related to the difference between projected and actual misstatements.

The Amount by Which a Projected Likely Misstatement Differs from an Actual