Which of the following statements concerning the audit risk model is false?
A)It is used to determine the planned level of substantive audit testing to be performed in the audit.
B)It is useful as a planning tool at the beginning of the audit.
C)It is applied at both the financial statement and individual account and financial statement assertion levels.
D)It allows the auditor to accurately quantify the level of audit risk.

Question

Quizplus · Accepted Answer

The audit risk model does not allow the auditor to accurately quantify the level of audit risk as it is based on estimates and judgment. The model is used to plan the level of substantive audit testing, assess the risk of material misstatement, and determine the nature, timing, and extent of audit procedures.

Which of the Following Statements Concerning the Audit Risk Model