Inherent Risk: Susceptibility of an assertion to material misstatement before internal controls
Control Risk: Risk that a material misstatement will not be prevented/detected by internal controls
Detection Risk: Risk that auditor's procedures will not detect a material misstatement that exists
Significant Risk: Risk requiring special audit consideration; cannot be addressed solely by reliance on controls
Material Weakness: Deficiency in ICFR where there is a reasonable possibility that a material misstatement will not be prevented or detected on a timely basis
COSO Framework: Five-component model (Control Environment, Risk Assessment, Control Activities, Information & Communication, Monitoring)
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AUD — Auditing & Attestation (Core)
Internal Controls
Inherent Risk: Susceptibility of an assertion to material misstatement before internal controls
Control Risk: Risk that a material misstatement will not be prevented/detected by internal controls
Detection Risk: Risk that auditor's procedures will not detect a material misstatement that exists
Significant Risk: Risk requiring special audit consideration; cannot be addressed solely by reliance on controls
Material Weakness: Deficiency in ICFR where there is a reasonable possibility that a material misstatement will not be prevented or detected on a timely basis
COSO Framework: Five-component model (Control Environment, Risk Assessment, Control Activities, Information & Communication, Monitoring)