Week 3 - Significant Risks

Question 1

What are significant risks?

Answer 1

Those risks which require specialist audit consideration in accordance with ISA315

Question 2

What do significant risks relate to?

Answer 2

Most often relate to significant non-routine transactions and/or judgemental matters

Question 3

What are the first 2 examples of matters to consider?

Answer 3

• risk of fraud
• related to significant economic, accounting or other developments

Question 4

What are the second 2 examples of matters to consider?

Answer 4

• a complex transaction
• significant transaction with a related party

Question 5

What are the final 2 examples of matters to consider?

Answer 5

• the degree of subjectivity in the information
• it is an unusual transaction