What type of risk is an auditor primarily concerned about?

The primary concern of an auditor is audit risk, which refers to the risk that the auditor may issue an inappropriate opinion on financial statements that are materially misstated. This encompasses two major components: the inherent risk that exists due to the nature of the business and the controls in place, and detection risk, which is the risk that the auditor's procedures fail to detect misstatements.

Auditors focus on audit risk because their primary role is to provide assurance that financial statements are accurate and reliable. They must assess various factors, including the complexity of transactions, the degree of judgment involved, and the effectiveness of internal controls. By addressing audit risk, auditors aim to minimize the likelihood of errors or fraud going unnoticed, thus enhancing the credibility of the financial reporting process.

Other types of risks, such as market risk, operational risk, and liquidity risk, while important for overall business assessments, do not specifically relate to the auditor’s assessments of financial statements or the reliability of the audit itself. These risks can affect the entity's performance but do not directly pertain to the auditor's primary objective, which is to provide a true and fair view of an organization's financial condition through their audit opinion.