Jennifer has just left her auditing class at a local state university and is walking across campus thinking about her professor mentioning during the lecture about the relationship between cash and inherent risk. Jennifer is not sure she fully understands the relationship between these two components and emails the professor to ask for clarification. Which of the following would represent the professor's best response? The easiest way to think of the relationship between these two items is to think that cash is perhaps one of the easier assets to manipulate, and as a result, inherent risk is usually assessed as higher by the auditor. The research literature indicates that there is an inverse relationship between cash and inherent risk, in the sense that when cash fraud risk increases, inherent risk decreases and vice-versa. The best way to understand this relationship is to think of cash being a highly illiquid asset. As a result, inherent risk is typically assessed as higher by the auditor because cash is usually subject to strict segregation of duties and thus is hard to manipulate. There isn't really any defined relationship between cash and inherent risk. It is just easier to discuss them both at the same time, as they both represent areas of increased audit risk