Inherent risk List some factors that would lead an auditor to assess inherent risk relating to operations at a higher level
Factors that would lead an auditor to assess inherent risk relating to operations at a higher level include:
? The company lacks personnel or expertise to deal with the changes in the industry.
? New products and service offerings have uncertain likelihood of successful introduction and acceptance by the market.
? The use of information technology is incompatible across systems and processes.
? Expansion of the business for which the demand for the company's products or services has not been accurately estimated.
? A new business strategy is incompletely or improperly implemented.
? Financing is lost due to the company's inability to meet financing requirements.
? New regulatory requirements increase legal exposure.
? Alternative products, services, competitors, or providers pose a threat to current business.
? There are significant supply chain risks.
? The production and delivery processes are complex.
? The industry is mature and declining.
? The organization lacks ability to control costs with the possibility of unforeseen costs.
? The organization produces products that have multiple substitutes.
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