Walter Polonia was explaining to his junior staff the implications of sampling risk when conducting substantive testing.

He made the following two statements:

(i)If we conclude that a material misstatement does not exist when it does, then we have an increased control risk.

(ii)If we conclude that a material misstatement exists when it does not we have an inefficient audit.

Which statements, if any, were true?

a.(i)

b.(ii)

c.(i) and (ii)

d.neither (i) or (ii)