- 1 Marks
AA – L2 – SA – Q5.4 – Detection Risk
Question
Detection risk is influenced by:
A Internal audit
B The client
C Executive and non-executive directors
D The external auditor
Answer
D
Explanation:
Detection risk is the risk that the external auditor’s procedures fail to detect material misstatements. It is directly influenced by the auditor’s design and execution of audit procedures. Internal audit, the client, and directors may affect inherent or control risks, but detection risk is specific to the external auditor’s work. Option D is the correct answer.
- Tags: Audit Risk, Detection Risk, External auditor, ICAG
- Level: Level 2
- Uploader: Salamat Hamid