Which of the following is the most likely outcome when the upper limit rate of deviation is less than the tolerable rate of deviation?
A) The auditor would be exposed to the risk of assessing control risk too low.
B) The auditor would decide to reduce the planned degree of reliance on internal control.
C) The auditor would increase the extent of further audit procedures.
D) The auditor would be exposed to a potential efficiency loss.

Question

Quizplus · Accepted Answer

When the upper limit rate of deviation is less than the tolerable rate of deviation, it indicates that the control is functioning effectively, leading the auditor to potentially assess control risk too low, thus relying more on the controls than warranted.

Which of the Following Is the Most Likely Outcome When