You work as a Network Auditor for Net Perfect Inc. The company has a Windows-based network.
While auditing the company’s network, you are facing problems in searching the faults and other
entities that belong to it. Which of the following risks may occur due to the existence of these
problems?

A.
Residual risk

B.
Secondary risk

C.
Detection risk

D.
Inherent risk

Explanation:
Detection risks are the risks that an auditor will not be able to find what they are
looking to detect. Hence, it becomes tedious to report negative results when material conditions
(faults) actually exist. Detection risk includes two types of risk: Sampling risk: This risk occurs
when an auditor falsely accepts or erroneously rejects an audit sample. Nonsampling risk: This
risk occurs when an auditor fails to detect a condition because of not applying the appropriate
is incorrect. Residual risk is the risk or danger of an action or an event, a method or a (technical)
process that, although being abreast with science, still conceives these dangers, even if all
theoretically possible safety measures would be applied (scientifically conceivable measures). The
formula to calculate residual risk is (inherent risk) x (control risk) where inherent risk is (threats
vulnerability). In the economic context, residual means “the quantity left over at the end of a
or section being audited is materially misstated without considering internal controls due to error or
fraud. The assessment of inherent risk depends on the professional judgment of the auditor, and it
incorrect. A secondary risk is a risk that arises as a straight consequence of implementing a risk
response. The secondary risk is an outcome of dealing with the original risk. Secondary risks are
not as rigorous or important as primary risks, but can turn out to be so if not estimated and
planned properly.