(a) Explain four (4) key risks of material misstatement at the financial statement level and determine the overall audit response to address each risk.(280 words) (Hint: Management override of control etc)
(8 marks)
(b) Explain two (2) key risks of material misstatement at the assertion level other than those identified in the case study information about accommodation revenue. For each, identify the key assertion and accounts at risk.(200 words)
(6 marks)
(c) Review the materiality workpaper prepared by the audit senior. Recommend corrections to all the errors in the working paper. (260 words) (Hint: Public listed so Profit before tax is appropriate etc.)
(8 marks)
(d) For each of the identified risks in the walkthrough of accommodation revenue and receipts cycle, identify the associated assertion. Prepare a risk and control matrix for the accommodation revenue and receipts process. (260 words) (Hint: refer to attached sample risk and control matrix workbook to get idea how to answer)