Which of the following statements is true
with regard to the relationship among audit
risk, audit evidence, and materiality?
a. The lower the inherent risk and control
risk, the lower the aggregate materiality
threshold.
b. Under conditions of high inherent
and control risk, the auditor should
place more emphasis on obtaining
external evidence and should reduce
reliance on internal evidence.
c. Where inherent risk is high and control
risk is low, the auditor may safely ignore
inherent risk.
d. Aggregate materiality thresholds should
not change under conditions of changing
risk levels
with regard to the relationship among audit
risk, audit evidence, and materiality?
a. The lower the inherent risk and control
risk, the lower the aggregate materiality
threshold.
b. Under conditions of high inherent
and control risk, the auditor should
place more emphasis on obtaining
external evidence and should reduce
reliance on internal evidence.
c. Where inherent risk is high and control
risk is low, the auditor may safely ignore
inherent risk.
d. Aggregate materiality thresholds should
not change under conditions of changing
risk levels