Your answer is incorrect. Charlie and Sue are working on the audit of Parkberry Enterprises, a medium-sized company and distributor of wooden cabinetry across the southeastern United States. Charlie is working on his first audit of a client's purchasing process and Sue is assisting him. Charlie asks Sue why the auditors spend a comparatively large amount of time auditing the client's purchasing cycle. Which of the following responses by Sue most appropriately answers this question? O Qur audit firm determined during the initial audit of this client a few years back that we could bill the client for a relatively large number of billable hours due to the time we could spend auditing this area. O The audit firm typically spends a relatively large amount of time auditing this area. The reason for this is because there is a large volume of transactions in this area and the transactions are generally routinized. O The audit firm spends a considerable amount of time auditing the purchases cycle for this client because this area represents increased inherent risk for the client. Because of this increased risk, we amend our audit strategy to more of a reliance approach. None of these answer choices are correct. X Your answer is incorrect. Janessa has just graduated from a local university and accepted a job with Hartke CPAs. During her first week on the job, and as the CPA firm is working on the audit of a client's financing cycle, Janessa asks her supervisor why the CPA firm needs to concern itself with this area, as surely inherent risk would be low. Which of the following represents the correct response by her supervisor to this question? You are correct. Inherent risk in this area is indeed low, however we can increase the number of billable audit hours so we perform testing in this area anyway. O That is not the case. Inherent risk associated with a client's financing cycle is high because of the complexity of the associated interest and dividend transactions that accompany these activities. O That is not the case. Inherent risk in this area is often assessed as higher by auditors because of the prior number of financial statement restatements that have emerged from activities in this area. O None of these answer choices are correct