Summarize six advantages of the business risk approach in auditing.

Summarize six advantages of the business risk approach in auditing.

• Investigation of business risk enables the auditor to have a profound knowledge of the
business.
• The approach focuses the audit on to the high risk areas which are material to the
business.
• The approach adds value to the audit and enables'the auditor to offer some commercial
benefit to the audit.
• The previous emphasis on transactions and systems was expensive and uneconomic.
• The business environment and corporate governance issues and the nature of
management control, are all now more significant for and translate more quickly into the
financial statements.
• The approach tends to involve partners and senior managers much more in the planning
styles of an audit.
• The business risk review may show up area where the auditor can suggest that its highly
paid service can be offered the client.
• The pace of change in business in computing and communications means that companies
are much more at risk of failure than ever before.

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Kavungya answered the question on May 14, 2019 at 12:47

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