Corporate Responsibility and Control Risk

Grosu Maria ()
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Grosu Maria: „Alexandru Ioan Cuza” University of Iasi

Ovidius University Annals, Economic Sciences Series, 2011, vol. XI, issue 1, 878-883

Abstract: Control risk (CR) refers to the likelihood that material misstatement of the financial statements can not be prevented or detected and corrected by the entity's internal control. This risk is assessed by the auditor after obtaining an understanding of the entity's control environment risk assessment quizzes (TER) and after obtaining evidence of operating effectiveness of internal controls through control tests (TC). Typically, the auditor establishes a high level of control risk, even 100% as the confidence in the SCI is low. However, there are exceptions, such as identification by the auditor's internal controls well designed and operating effectively, or when the auditor plans to conduct tests to support the extended control that risk assessment at a lower level. However, one thing is certain: the RC is higher; the volume of evidence must be higher to support an audit risk as small. In this study we demonstrate that the correct estimation of risk control as an appropriate methodology will help to streamline the audit process and reduce its costs.

Keywords: internal control; control risk; corporate responsibility; auditor approach; control mechanisms. (search for similar items in EconPapers)
JEL-codes: M14 M38 M41 M42 M48 (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:ovi:oviste:v:11:y:2011:i:1:p:878-883

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