Control risk
- Term
- Control risk
- Exam
- CISA
- Definition
The risk that a material error will not be prevented or detected in time by the organization's controls.
- Explained
Control risk is the chance that a material error is not prevented or detected in time by the organization's own controls. Auditors assess it by evaluating control design and testing operating effectiveness. When testing shows deviations, control risk rises and the auditor must increase substantive testing.
- In practice
If approvals are often skipped, control risk is high because errors may not be prevented.
- Often confused with
- Detection risk
- Exam angle
High control risk calls for more substantive testing.
- Related