Based on professional judgment an auditor establishes that if the amount of error or omission is within 1% of total revenue it is not considered as misstatement. Assume, the amount of service revenue is overstated by OMR 5,000 which is 5% of total revenue. Does it amount to material misstatement? a. Unable to decide as the data is inadequate O b. No, as the percentage of misstated amount is less than 1% of total revenue O c. None of the options O d. Yes, as the percentage of materially misstated amount is more than 1% of total revenue Audit risk may be considered as the product of Inherent risk, control risk and detection risk. What is the implication of increase in control risk on the audit risk? O a. Audit risk remains unaffected O b. Audit risk reduces c. Audit risk increases O d. Unable to decide