Audit Risk

What are the risk in audit world? How to reduce those risk?

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Rupesh Kumar Panda

  • Dec 28th, 2016

Audit Risk refer to the risk that audit opinion may goes wrong when the financial statement was misstated.There are two types of audit risk
1) Risk of material Misstatement
2) Detection risk.Risk of material misstatement mean risk that the financial statement was misstated prior to audit.

Detection risk refer to the risk that audit procedure fail to prevent, detect and correct the material mis-statement. Risk of material mi-statement is further sub-divided into Inherent risk and Control risk.

Detection risk is further divided into sampling risk and non sampling risk

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