An auditor has a set an overall level of acceptable audit risk in respect of a client of 10%, inherent risk has been assessed of 50% and control risk at 80%.

Requirement

1.Explain the meaning of a 10% level of audit risk

2.What level of detection risk is implied by this information?

3.If level of audit risk were only 5%, how would this affect the level of detection risk and how would this affect the level of detection risk and would the audit work be affected by this changes