Question: (a) The auditors considered Phar-Mor to be an inherently high risk client. List several factors at Phar-Mor that would have contributed to a high inherent

(a) The auditors considered Phar-Mor to be an inherently "high risk" client. List several factors at Phar-Mor that would have contributed to a high inherent risk assessment.
(b) Should auditors have equal responsibility to detect material misstatements due to errors and fraud?
(c) Which conditions, attitudes, and motivations at Phar-Mor that created an environment conducive for fraud could have been identified as red flags by the external auditors?

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a Some of the factors that would have contributed to a high inherent risk assessment include the following PharMor was competing in a highly competitive industry too good to be true PharMor was rapidl... View full answer

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