AICPA CPA-Auditing Exam - Topic 2 Question 121 Discussion

Actual exam question for AICPA's CPA-Auditing exam

Question #: 121
Topic #: 2

Control risk should be assessed in terms of:

ASpecific controls.

DControl environment factors.
Explanation
Choice 'c' is correct. The auditor identifies internal controls relevant to specific financial statement assertions, and then performs tests of controls to evaluate their effectiveness in preventing material misstatements in those assertions. Control risk should be assessed in terms of financial statement assertions.
Choice 'a' is incorrect. Control risk is not assessed in terms of specific controls.
Choice 'b' is incorrect. Control risk is not assessed in terms of types of potential fraud.
Choice 'd' is incorrect. Control risk is not assessed in terms of control environment factors.

CFinancial statement assertions.

BTypes of potential irregularities.

Show Suggested Answer

Suggested Answer: C

by Gerry at Jan 27, 2026, 03:18 AM

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Tammara

4 days ago

I remember a practice question where we had to assess control risk based on the likelihood of misstatements. It feels similar to this one.

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Ricki

10 days ago

I think control risk is about evaluating the effectiveness of internal controls, but I'm not entirely sure how to quantify that.

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Galen

15 days ago

I'm a bit unsure about the best way to structure my response here. Maybe I'll start by defining control risk and then discuss the key elements to consider when assessing it.

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Norah

20 days ago

This seems straightforward enough. I'd focus on evaluating the design and implementation of the control environment, as well as any potential weaknesses that could lead to control breakdowns.

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Abel

25 days ago

Okay, let me think this through. I believe we need to assess things like the strength of internal controls, the competence of personnel, and the potential for human error or fraud.

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Yuki

1 month ago

Hmm, I'm not entirely sure how to approach this. I know control risk has to do with the likelihood of errors or issues occurring, but I'm not confident in the specifics.

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Mabelle

1 month ago

I think this question is asking us to consider the different factors that contribute to control risk in an organization.

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