audit Chapter 9.docx - Chapter 9 Question 40 Part A 1 According to the situation it is unlikely to have the acceptable risks at this moment However if

audit Chapter 9.docx - Chapter 9 Question 40 Part A 1...

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Chapter 9 Question 40. Part A 1. According to the situation, it is unlikely to have the acceptable risks at this moment. However, if they continue to decide on going for solar powered engine industry, they will likely to have the likelihood of financial difficulties unless they could find knowledge and people to perform. 2. In this situation, the firm will have likely to have the material misstatement in the financial statement. The reason why is that since the manager doesn’t know about the section, it means the section does not have any record on the statements of the firm provides. It is the low acceptable audit risk. 3. It doesn’t seem like a problem in auditing. 4. Not only what firm did is the dangerous for its employees who might be trained for doing construction work but also it raise the question of the firm’s financial situation of why the employee had to do the construction work. So, this will lead the likelihood of financial difficulties.
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