Concluding that controls are more effective, or a balance more accurate, than they are affects audit effectiveness, while the opposite affects efficiency. Larger samples reduce this risk; non-sampling risks such as choosing the wrong procedure are managed separately.
Source: BDS 530
Related terms
Audit samplingApplying audit procedures to some rather than all of the items in an account or class of transactions in order to reach a conclusion about the whole population.Detection riskThe risk that the procedures performed by the auditor will not detect a material misstatement that exists.Audit evidenceAny information and documents the auditor uses to reach the conclusions on which the opinion is based.Adverse opinionThe opinion in which the auditor states that the financial statements are not presented fairly, where misstatements are both material and pervasive.Agreed-upon proceduresAn engagement in which the practitioner performs procedures agreed with the entity and, where relevant, a third party, and reports only the findings without providing assurance.Analytical proceduresThe evaluation of financial information through analysis of plausible relationships among financial and non-financial data.
Last updated: November 8, 2026 · This definition is for general information only.