Risk in Auditing
The audit risk model expresses the risk of an auditor providing an inappropriate opinion of a commercial entity's financial statements. It can be analytically expressed as:
- AR = IR x CR x DR
Where AR is audit risk, IR is inherent risk, CR is control risk and DR is detection risk.
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Famous quotes containing the word risk:
“The effect of liberty to individuals is that they may do what they please: we ought to see what it will please them to do, before we risk congratulations.”
—Edmund Burke (1729–1797)