For each one of the following risk factors relating to misstatements arising from fraudulent reporting, identify the appropriate category.
1.Inability to generate cash flows from operations while reporting earnings and earnings growth.
2.High degree of competition or market saturation, accompanied by declining margins.
3.High turnover of senior management, counsel, or board members.
4.Difficulty in determining the organization or individual(s) that control(s) the entity.
5.Strained relationship between management and the current or predecessor auditor.
6.Declining industry with increasing business failures and significant declines in customer demand.

Question

Quizplus · Accepted Answer

The Answer of For each one of the following risk factors relating to misstatements arising from fraudulent reporting, identify the appropriate category.
1.Inability to generate cash flows from operations while reporting earnings and earnings growth.
2.High degree of competition or market saturation, accompanied by declining margins.
3.High turnover of senior management, counsel, or board members.
4.Difficulty in determining the organization or individual(s) that control(s) the entity.
5.Strained relationship between management and the current or predecessor auditor.
6.Declining industry with increasing business failures and significant declines in customer demand.

For Each One of the Following Risk Factors Relating to Misstatements