8e_Ch4_Mini_case_Und_Entity done Questionnaire - A Questionnaire for Documenting the Understanding of EarthWear Clothiers and its Environment Client

8e_Ch4_Mini_case_Und_Entity done Questionnaire - A...

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Completed by: James Justice Date: 10/17/13 Question Risk Factors Any Remaining Risk 1 What are the entity’s major sources of revenue, including the nature of its products and/or services? Yes. The emerging internet market could be huge, or it could be a bust. If they're able to quickly move on it that venture is going to be a lot less risky. 2 Who are the entity’s key customers? Yes. There's a risk in loosing the key customers if they aren't able to keep customer service standards high. 3 Who are the entity’s key suppliers? Yes. With things changing in the international market business might have to change the ways they do busines / whom they do business with. This is a potential risk to the company. 4 What is the entity’s organizational structure? No. 5 Where are its major locations? No. None of these country locations pose threats to EarthWear as a result of expropriation or limits on repatriation of earnings. 6 What are the entity’s major assets? No. Valuation might increase / decrease but there's no risk of loosing these assets. 7 What are the entity’s major liabilities? Yes. While currently Earthwear is not pushing it's debt, there's always a chance that it would potentially in the future push that debt. 8 What are the entity’s financial characteristics including financing sources and current and prospective financial condition? No. 9 Are there any potential related parties? No. 10 Are there any individually significant events and transactions such as acquisitions or disposals of subsidiaries, businesses, or product lines during the year? No. 11 Does the entity have any major uncertainties or contingencies? No. 12 Do general economic conditions present any risks for the entity? No. The company is aware of the importance of fourth quarter sales. The company continues to refine its catalog mailings, so quarterly results may fluctuate. 13 Does the regulatory environment present any risks for the entity? No. 14 Does the legal/political environment present any risks for the entity? No. 15 Does the competitive industry environment present any risks for the entity? Identify any competitors. Yes. If they're not able to keep-up with industry standards and trends they will lose customers. 16 Do supplier dynamics present any risks for the entity? No. 17 Do customer dynamics present any risks for the entity? Yes, they have a potential to set aside existing cutomers trying to get new customers. 18 Do social/environmental factors present any risks for the entity? No. 19 Do technological factors present any risks for the entity? Yes. They need to make sure security is on in the website, to protect against potential hackers and theifs. 20 Do accounting principles, including those that are industry-specific and determined by regulatory authority present any risks for the entity?
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