On the basis of audit evidence gathered and evaluated, an auditor decides to increase the assessed level of risk of material misstatement from that originally planned. To achieve an overall audit risk level that is substantially the same as the planned audit risk level, the auditor would:
A)decrease amount of substantive testing.
B)decrease detection risk.
C)increase detection risk.
D)increase materiality levels.

Question

Quizplus · Accepted Answer

Decreasing detection risk means the auditor plans to perform more substantive testing or use more precise testing methods to lower the risk that they will not detect a material misstatement. This compensates for the increased assessed risk of material misstatement, aiming to maintain the overall audit risk at the planned level.

On the Basis of Audit Evidence Gathered and Evaluated, an Auditor