An increase in the effectiveness of internal controls will have the effect of
A)increasing inherent risk.
B)reducing inherence risk.
C)increasing control risk.
D)reducing control risk.

Question

Quizplus · Accepted Answer

An increase in the effectiveness of internal controls will reduce control risk. Control risk is the risk of material misstatement occurring and not being prevented, detected or corrected by the entity's internal controls. Therefore, the better the internal controls, the lower the control risk.

An Increase in the Effectiveness of Internal Controls Will Have