Chap to 4 danh gia rui ro

51) Audit risk is the auditor's exposure to loss or injury of his or her reputation from events arising

in connection with financial statements audited.

• True

• False

Answer explanation

Đây là Engagement Risk

52) Engagement risk is the auditor's exposure to loss or injury of his or her reputation from events

arising in connection with financial statements audited.

• True

• False

53) The components of the audit risk model include inherent risk, control risk, and detection risk.

• True

• False

54) Inherent risk is the susceptibility of an assertion to material misstatement, assuming no related

controls.

• True

• False

55.Professional Judgment must be used when evaluating business risk

• True

• False

56) The risk of a material misstatement includes inherent risk and sampling risk.

• True

• False

Answer explanation

RMM=IR*CR(Control Risk)

57) The combination of inherent risk and control risk is referred to as client risk.

• True

• False

Answer explanation

Risk made by client (Not auditor)--> Client Risk

58) Inherent risk includes sampling risk and detection risk.

• True

• False

1) Engagement risk is:

• A) the risk of issuing an incorrect audit opinion.

• B) the auditor's risk of loss from events arising in connection with financial statements audited

  and reported upon.

• C) the overall risk of material misstatement.

• D) the risk of the entity's financial failure.

2) Client risk as defined in the text is:

• A) the auditor's risk of loss from events arising in connection with financial statements audited

  and reported upon.

• B) the overall risk of material misstatement.

• C) the risk that audit procedures will fail to detect material misstatements.

• D) the risk of the entity's financial failure.

Answer explanation

Client Risk=(overall) Risk of Material Misstatement