- This topic has 1 reply, 2 voices, and was last updated 1 year ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
Congratulations to Jamil from Pakistan and Jeeva from Malaysia - Global Prize winners!
see all ACCA December 2022 Genius Hunt Competition winners >>
Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>
Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › Audit risk and deficiencies
Hi Tutor,
I want to ask what is the difference between this question
1) Describe seven Audit Risk
2) Identify and explain five deficiencies
I have trouble on this question on how to answer it
See Chapter 9 – audit risk has 3 components – inherent risk (IR), control risk (CR) (together make up RoMM) and detection risk (DR).
If IR is assessed as high – RoMM is not necessarily high – because it depends on “how good” (or bad) the system of internal controls.
If the auditor identifies deficiencies in internal control, RoMM will however be the same as IR.
Only if controls are expected to be effective will the auditor perform tests of controls – see the overview at the beginning of Chapter 8 and the explanation of approach on the opposite page.