AUDTT RISK MODEL PROBLEM ABC&Co. is an audit and assurance firm which has recently accepted...
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AUDTT RISK MODEL PROBLEM
ABC&Co. is an audit and assurance firm which has recently accepted the audit of Banco de oro (BDO) . During the planning of the audit, engagement manager has noted the following information regarding BDO for consideration in the risk assessment of the assignment:
- BDO is a listed company operating in the financial services sector
- BDO has a large network of subsidiaries, associates and foreign branches
- The company does not have an internal audit department and its audit committee does not include any members with a background in finance as suggested in the corporate governance guidelines
- It is the firm's policy to keep the overall audit risk below 10%
- Assumed control risk is 50% and inherent is 60%
Required:
Compute for the planned detection risk?
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