TIJAY REQUIRED: (a) What risk level is Michele the Audit Manager most likely to attribute to the company's INHERENT RISK ("IR")? Ensure you explain WHY you selected this specific risk level for the Inherent Risk. (reminder: use HIGH, MEDIUM or LOW risk level descriptions] (b) What risk level is Michele the Audit Manager most likely to attribute to the company's CONTROL RISK ("CR")? Ensure you explain WHY you selected this specific risk level for the Control Risk. (reminder: use HIGH, MEDIUM or LOW risk level descriptions} (c) Given your response to (a) and (b), describe a reasonable decision choice the Audit Firm could make with respect to DETECTION RISK ("DR") on this engagement. Ensure you explain WHY. STUDENT RESPONSE BELOW: Format B I U A/ Ev = v + v a Listen A USING THE AUDIT RISK MODEL IN PRACTICAL SITUATIONS CHEONG INC.: You are an audit firm accountant working with your Audit Manager, Michele Teper, on an engagement with Cheong Inc., the auditee. The Audit Firm of Teper and Lubetsky always sets its overall Audit Risk at exactly the same level for every audit engagement, at an acceptably low audit risk level (the Audit Firm does not apply a numerical number, but does describe the Audit Risk as "LOW"). In a conversation with Michele, you hear her say the following: "On this Cheong Inc. audit, I see that the company does business in a very stable industry with no variability. Cheong has no related party accounting transactions." Watch Free Movies Online "As for Cheong's procedures for detecting and/or preventing a material misstatement in its financial reporting, my assessment is that they are not effective at all. I think the accounting staff would not detect or prevent a material misstatement, should it occur". When describing a risk level, student must choose one of: HIGH, MEDIUM or LOW risk levels. REQUIRED