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risk n threat

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › risk n threat

  • This topic has 1 reply, 2 voices, and was last updated 13 years ago by Ken Garrett.
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  • June 11, 2012 at 8:04 pm #53342
    ghaziamanzoor
    Member
    • Topics: 1
    • Replies: 0
    • ☆

    what is meant by inherent risk n advocacy threat??

    June 12, 2012 at 2:35 am #100099
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10594
    • ☆☆☆☆☆

    Ingerent risk is the risk that an error is made in the first place, ie before taking into account any controls and audit work that might prevent or detect the error.

    Advocacy threat arises if the auditor gives support (advocates) a client. The auditor will then want that support to look as though it was justified so might, for example, let the client overstate profits.

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