All other factors held constant,if the auditor decreases acceptable audit risk then
A)there will be less documentation in the audit file.
B)total audit evidence and audit costs will increase.
C)it will also be necessary to decrease either control risk or inherent risk.
D)less supervision of the audit team will be required.

Question

Quizplus · Accepted Answer

Decreasing acceptable audit risk means the auditor is willing to accept a lower level of risk that the financial statements may contain material misstatements. To achieve this, the auditor will need to gather more and higher quality audit evidence, which will increase the total audit costs. All other factors being constant, reducing acceptable audit risk does not necessarily require a decrease in control risk or inherent risk, nor does it result in less documentation or supervision.

All Other Factors Held Constant,if the Auditor Decreases Acceptable Audit