P ASR 001 | Rev Section 2 (18 Marks) Mr Mass in the appointed auditor of Multichoice and he has been asked to calculate inherent risk. The audit risk is 7%, detection risk 80% and control risk is 64%. He wants to reduce audit risk to an acceptably low level by increasing materiality. Based on the given scenario: a) Calculate inherent risk? (4) Page 2 of 4 What is the effect of increasing inherent risk on the audit risk? c) Indicate the factors that indicate the existence of inherent risk? (2) (4) d) Mention ways that Mr Mass can use to reduce detection risk to an acceptably lower level of assurance? (4) e) Provide Examples of control risk? (4)