Question

During a concealment investigation, an investigator fails to recognize that an invoice had been forged. This represents a:

1. sampling risk.
2. non-sampling risk.
3. systematic risk.
4.systemic risk.

Answer 1

B

Step-by-step explanation:

Non sampling risk

A non sampling risk is a part of audit risk that outcome stems from an incomplete examination of the available data. This results from the failure of an auditor to catch a mistake or a misstatement. This can happen because an evidence was either misinterpreted or procedures were misapplied that were inappropriate.

Factors leading to Non samplimg risk are:

Failure to recognize or discover a material misstatement

Applying inappropriate audit procedures

Misinterpretting of audit test results

Answer 2

Non-sampling risk

Step-by-step explanation:

Non-sampling risk happens from an incomplete examination of the available data.

Here investigator fails to recognize that an invoice had been forged. Thus, the data was examined in an incomplete way.