Which of the following statements regarding the risk of material misstatement is correct?

Only factual misstatements should be considered when making the assessment of risk and the determination of any adjustments that may need to be made.

The risk that a material misstatement may occur due to complex calculations, faulty estimates, or high volume transactions is known as control risk.

Detection risk is the risk that a material misstatement will not be detected by the entitys internal controls.

The risk of material misstatement includes the auditors assessment of inherent risk as well as control risk.