An example of a sales-related factor that would decrease inherent risk would be ________.
A)complicated revenue recognition policies
B)lax oversight of management by the board of directors
C)nominal legal compliance issues when making and collecting sales
D)existence of excessive sales goals/targets

Question

Quizplus · Accepted Answer

Nominal legal compliance issues when making and collecting sales would decrease inherent risk as it indicates that the company is compliant with relevant laws and regulations, reducing the risk of legal repercussions. The other options would actually increase inherent risk by introducing complexities or potential misconduct.

An Example of a Sales-Related Factor That Would Decrease Inherent