Risk Response in Auditing and Assurance
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Questions and Answers

What is the starting point for designing an effective audit response?

  • External confirmation of audit evidence
  • Listing of assessed risks developed at the end of the risk assessment phase (correct)
  • Assessment of material misstatements at assertion levels
  • Conducting analytical procedures

    • At what levels is an assessment of the risks of material misstatements required?

  • Neither financial statement nor assertion levels
  • Only financial statement level
  • Both financial statement and assertion levels (correct)
  • Only assertion level

    • What do responses to the risk consist of?

  • External confirmation of audit evidence
  • Maintaining audit documentation
  • Conducting audit sampling
  • Designing various audit procedures to gather evidence about financial statement assertions (correct)

    • Which standard is specifically for external confirmation?

    <p>PSA 505: External Confirmation</p> Signup and view all the answers

    When is an assessment of the risks of material misstatements required?

    <p>At both financial statement and assertion levels</p> Signup and view all the answers

    What is the starting point for designing an effective audit response?

    <p>Listing of assessed risks developed at the end of the risk assessment phase</p> Signup and view all the answers

    At what levels is an assessment of the risks of material misstatements required?

    <p>Both financial statement and assertion levels</p> Signup and view all the answers

    What do responses to the risk consist of?

    <p>Designing various audit procedures to gather evidence about financial statement assertions</p> Signup and view all the answers

    Which standard is specifically for external confirmation?

    <p>PSA 505: External Confirmation</p> Signup and view all the answers

    What is required at both financial statement and assertion levels?

    <p>Assessment of the risks of material misstatements</p> Signup and view all the answers

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