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What is the maximum detection risk the auditors

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The auditors of Smith Electronics wish to limit the audit risk of material misstatement in the test of accounts receivable to 5 percent. They believe that inherent risk is 100%, and there is a 40% risk that material misstatement could have bypassed the client's system of internal control.

Question 1: What is the maximum detection risk the auditors should specify in their substantive procedures of details of accounts receivable?

Reference no: EM132465239

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