| LO 4-1 | Define business risk and understand how management addresses business risk with the enterprise risk management model. |
| LO 4-2 | Explain auditors' responsibility for risk assessment, and define and explain the differences among several types of fraud and errors that might occur in an organization. |
| LO 4-3 | Describe the audit risk model and explain the meaning and importance of its components in terms of professional judgment and audit planning. |
| LO 4-4 | Understand sources of inherent risk factors including the client's business and environment. |
| LO 4-5 | Understand sources of information for assessing risks including analytical procedures, brainstorming, and inquiries. Explain how auditors respond to assessed risks. |
| LO 4-6 | Explain auditors' responsibilities with respect to a client's failure to comply with laws or regulations. |
| LO 4-7 | Describe the content and purpose of an audit strategy memorandum. |
