[Anonymous]

In the past I assumed it was a trick question because we as auditors have no control over inherent risk (it’s inherent after all) but I now think that circumstances can increase or decreased inherent risk, such as company patents expiring or a bad state of economy, etc.

Does that sound about right?

[mangos]

Yes.

FAR (5/07/13): 96

[MCLKT]

Yep. Outside factors like gov't regulation, etc. There are factors that will determine the inherit risk, and it can change. But not through your audit or any procedure you do.

A:[73]97 F:[74]85 R:86 B:[74]82
*NINJA 10 Pt. COMBO & Yaeger*

[Almost Done]

On the test look out for estimation transactions, non-routine transactions, susceptibility to theft, management override, and/or potential collusion. I think those are the topics that would be tested. (not from experience, I have seen a few of them in practice exams)

BEC: Passed
REG: Passed
FAR: Passed
AUD: Passed

[Never_Give_Up1]

Inherent risk is also related to their software not operating as intended. Not posting correct J/E, posting incorrect cash… things of that nature. So your inherent risk would go up if you found errors in their I/T software but your control risk would go up if they did not have something in place to catch it.

FAR - 81
REG - 81
AUD - 82
BEC - 81

Ethics - Done
State License Exam - Done

License - Licensed CPA in Utah

[Zaq]

What all the above said.

I'd say the biggest thing to take from this is that although the auditor's cannot change {Control Risk} nor Inherent Risk through substantive testing or test of controls, auditors CAN change their assessed level of risk that they give to each of these. Clearly, this risk assessment is based on factors outside of the auditor's control.

{Edited by MCLKT: Just fixed the reference to Control Risk and Inherent Risk to minimize any confusion}

FAR: 50, 76!
REG: 74... (ouch baby, very ouch), 76!
AUD: 65, 91!?
BEC: 80! Aaaand doneskies!

May 2012 to August 2013. Can't believe it's over.

[Anonymous]

Thanks guys!

Leaving to the test center in 30 min!

Thanks!!!!

Wish me luck

[Zaq]

*Control risk.

Not detection risk!

FAR: 50, 76!
REG: 74... (ouch baby, very ouch), 76!
AUD: 65, 91!?
BEC: 80! Aaaand doneskies!

May 2012 to August 2013. Can't believe it's over.

[RopinC]

Thanks for posting this, it helped.

Here we go......?

REG - April 06, 2013 PASSED
AUD
FAR
BEC

[MCLKT]

@InfernoOmni: I got your back! Thanks for contributing to the conversation.

I edited your post to help minimize any confusion 🙂

A:[73]97 F:[74]85 R:86 B:[74]82
*NINJA 10 Pt. COMBO & Yaeger*

[Author]

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