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Hi Mike sir,
Can you just clarify whether this is correct in my understanding?
– In evaluating AUDIT RISKS, we will see for QUALITATIVE risk factors which may make our audit complex and where more work may be required.
– In evaluating RISKS OF MATERIAL MISSTATEMENT, we will see for QUANTITATIVE risk factors which would directly affect the financial statements at assertion level (things which are or maybe going against the accounting standards)
If its not correct, could you tell where its wrong?
Thanks in advance
If you can accept (as you must!) that audit risk is the risk of the auditor issuing an inappropriate audit opinion, then it could be both qualitative and quantitative matters of concern to the auditor
I would tend to agree that risk of material misstatement implies quantitative matters but, just thinking about it, I could include qualitative matters in there too. Incorrect or inappropriate of vague, tricky, ambiguous disclosure could qualify as material misstatement
But, as a general proposal, there is some merit in your summary
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