1.
Which of the following is a definition of control risk?
a. The risk that a material misstatement will not be prevented or detected on a timely basis by the
client's internal controls
b. The risk that the auditor will not detect a material misstatement
c. The risk that the auditor's assessment of internal controls will be at less than the maximum
level
d. The susceptibility of material misstatement assuming there are no related internal controls,
policies, or procedures
Solution
Choice "A" is correct .
Control risk is the risk that a material misstatement that could occur in a
relevant assertion will not be prevented or detected (and corrected) on a timely basis by the
entity's internal control.