Lesson: Responses to Risk

This lesson covers various responses to risk in an audit, emphasizing the importance of professional skepticism and utilizing audit evidence. It discusses the assignment of personnel and the supervision of auditing procedures to ensure accuracy and adherence to accounting principles. The lesson also highlights potential alterations in audit procedures, such as gathering more reliable audit evidence, changing the timing of the audit, and increasing sample sizes in response to higher risk. Additionally, it addresses the possibility of management override and ways to examine journal entries, review accounting estimates for biases, and evaluate the business rationale for significant unusual transactions.