(a) Inherent risk factor(s) to which each of the (b) Assessment of each risk, citing reasons for
identified risks of material misstatement your assessment, according to its
relates • magnitude (1 mark)
• likelihood (1 mark) and
• placement on the spectrum of inherent risk
(1 mark)
1. Change and Uncertainty Magnitude – High because financial statements
as a whole will be materially misstated if they
are prepared on the going concern basis when
in reality the entity does not satisfy the going
concern.
Likelihood -Low to medium since the audit
committee has the chief financial officer (CFO),
Dinah Maseko, who is a registered chartered
accountant which are expected to aware of
issues that threaten the going concern of an
entity.
identified risks of material misstatement your assessment, according to its
relates • magnitude (1 mark)
• likelihood (1 mark) and
• placement on the spectrum of inherent risk
(1 mark)
1. Change and Uncertainty Magnitude – High because financial statements
as a whole will be materially misstated if they
are prepared on the going concern basis when
in reality the entity does not satisfy the going
concern.
Likelihood -Low to medium since the audit
committee has the chief financial officer (CFO),
Dinah Maseko, who is a registered chartered
accountant which are expected to aware of
issues that threaten the going concern of an
entity.
