Which two of the following are external risk factors that an entity might consider?
A)Technological development can affect the nature and timing of research and development or lead to changes in procurement.
B)Changing customer needs or expectations can affect product development, production processes, customer service, pricing or warranties.
C)The quality of personnel hired and methods of training and motivation can influence the level of control consciousness within the entity.
D)The nature of the entity's activities, and employee accessibility to assets can contribute to misappropriation of resources.

Question

Quizplus · Accepted Answer

External risk factors refer to those factors that originate outside the entity and can potentially affect the entity's performance or operations. Technological development and changing customer needs or expectations are both examples of external risk factors that an entity might consider when assessing its risk environment. The other options (C and D) are related to internal risk factors, such as the quality of personnel and methods of training, which are directly controlled by the entity itself. The nature of the entity's activities and employee accessibility to assets can also be considered internal risk factors, as they are related to the entity's operations and infrastructure.

Which Two of the Following Are External Risk Factors That