Audit Risk Model - Changes in Audit Risk Using the audit risk model, state the effect on control risk, inherent risk, audit risk, acceptable audit risk, and planned evidence (substantive test of transactions, substantive test of detailed of balances and/or substantive analytical procedures) for each of the following independent events. Use the terms increase, decrease, no effect, or cannot determine from the information provided to describe the effect of the event. A. B. C. D. Audit Risk Acceptable Audit Risk Inherent Risk Control Risk Detection Risk Allowable (Planned) Detection Risk Planned Evidence E. F. G. 1. The client's management materially increased long-term contractual debt. 2. The company changed from a privately held company to a publicly held company. 3. The auditor decided to set control risk below maximum (it was previously assessed at maximum.) 4. The account balance increased materially from the preceding year without apparent reason. 5. You determined through the planning phase that working capital, debt-to-equity ratio, and other indicators of financial condition had improved during the past year. 6. This is the second year of the engagement, and there were few misstatements found in the previous year's audit. The auditor also decided to increase reliance on internal control. 7. The client began selling products online to customers through its web page during the year under audit. The online customer ordering process is not integrate with the company's accounting systems. Client sales staff print out customer order information and enter that data into the sales accounting system. 8. In discussions with management, you conclude that management is planning to sell the business in the next few months. Because of the planned changes, several key accounting personnel quit several months ago for alternative employment. You also observe that the gross margin percent has significantly increase compared with that of the preceding year. 9. There has been a change several key management person You believe that management is somewhat lacking in personal integrity compared with previous management. You believe that it is still appropriate to do the audit. 10. In auditing inventory, you obtain an understanding of internal control and perform tests of controls. You find it significantly improved compared with that of the preceding year. You also observe that because of tecnology changes in the industry, the client's inventory may be somewhat obsolete