A decrease in the tolerable misstatement has what effect on the required sample size?
A)Increases.
B)Decreases.
C)No effect.
D)Indeterminate.

Question

Quizplus · Accepted Answer

When the tolerable misstatement decreases, the auditor becomes more stringent in the allowable level of error in the financial statements. As a result, the required sample size increases to achieve a higher degree of confidence in the audit results.

A Decrease in the Tolerable Misstatement Has What Effect on the Required