TY  - JOUR
AB  - Business risk and inherent risk both bear on the audit; the audit
risk model; and the nature, timing, and extent of work performed.
Inherent risk and business risk bear an inverse relationship to
detec‐tion risk and have a direct effect on the level of work performed.
Neither risk can be eliminated totally and neither is controllable by
the auditor. Business risk relates to the financial statements and
affects overall audit risk; inherent risk applies to an individual audit
area. Inherent risk is explicitly included in the professional standards
and the audit‐risk model while business risk is not and has only an
indirect bearing on the model. Management can take steps to affect the
level of inherent risk, but the perceptions of users of the financial
statements bear on business risk.
VL  - 6
IS  - 3
SN  - 0268-6902
DO  - 10.1108/02686909110006543
UR  - https://doi.org/10.1108/02686909110006543
AU  - Colbert Janet L.
PY  - 1991
Y1  - 1991/01/01
TI  - Understanding the Relationship between Business Risk and
Inherent Risk
T2  - Managerial Auditing Journal
PB  - MCB UP Ltd
Y2  - 2024/04/24
ER  -