Day: September 25, 2025

As part of his overall risk assessment, Alex, the audit partner, has concluded that detection risk must be low.

For the issue of sample sizes, please select the appropriate consequence of this conclusion………..?

Select ONE answer:

1. Higher
2. Lower
3. Bigger
4. Smaller

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct => If detection risk is low this means that the auditor must have a higher expectation of identifying errors and misstatements. Materiality is lower as the financial statements are more sensitive and sample sizes are increased so that more work is performed.
4. Not correct

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