Which of the following statements regarding detection risk is true?
A)Detection risk incorporates both substantive analytical procedures and tests of details.
B)Detection risk provides guidance to the auditor on the substantive audit procedures needed to achieve the desired audit risk.
C)A low level of detection risk means the auditor needs to obtain more evidence from substantive procedures.
D)All of the above.

Question

Quizplus · Accepted Answer

Detection risk encompasses the risk that the auditor will not detect a material misstatement that exists within an assertion, which can be influenced by the nature, timing, and extent of the auditor's procedures. All the statements provided accurately describe aspects of how detection risk functions within the audit process, including its relationship with substantive procedures and tests of details.

Which of the Following Statements Regarding Detection Risk Is True