Reference no: EM132944878

Problem 1: If an auditor wishes to reduce the level of audit risk, then the auditor should:

Option 1: lower the level of inherent risk of the client.
Option 2: increase the level of detection risk.
Option 3: lower the level of control risk.
Option 4: decrease the level of detection risk.

Problem 2: Which one of the following statements about materiality is NOT true?

Option 1: Any misstatements in the income statement less than 10% of revenue would be material to users. Any misstatements in the income statement less than 10% of revenue would be material to users.
Option 2: Auditors use their professional judgment to arrive at an appropriate planning materiality amount for each client
Option 3: Information is considered quantitatively material if it exceeds the magnitude of an auditor's planning materiality assessment
Option 4: Information is considered qualitatively material if it affects a user's decision-making process for a reason other than its magnitude