CISA Information System Auditing Process Practice Question
An IS auditor is assessing the risk of a new financial application. The auditor determines that inherent risk is high due to complex transactions, but control risk is low because of strong automated controls. If detection risk is set at 5%, what is the audit risk?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
0.8%
Audit risk = Inherent risk × Control risk × Detection risk. Assuming inherent risk = 80%, control risk = 20%, detection risk = 5%, audit risk = 0.8 × 0.2 × 0.05 = 0.008 = 0.8%.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
8.0%
Why it's wrong here
Incorrect; this might be inherent risk times detection risk without control risk.
- ✓
0.8%
Why this is correct
Audit risk = Inherent risk × Control risk × Detection risk. With inherent risk 80%, control risk 20%, detection risk 5%: 0.8 × 0.2 × 0.05 = 0.008 = 0.8%.
- ✗
1.0%
Why it's wrong here
Incorrect calculation; audit risk is the product of the three risks.
- ✗
5.0%
Why it's wrong here
This is only detection risk, not the combined audit risk.
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JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
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