These starting points can be increased or decreased by taking into account qualitative client factors, which could be: the nature of the client’s business and industry (for example, rapidly changing, either through growth or downsizing, or an unstable environment) if the client is a listed entity (or subsidiary of) subject to regulations the knowledge of or high risk of fraud.Typically, profit before tax is used; however, it cannot be used if reporting a loss for the year or … (c) Which specific areas do you believe should receive special emphasis during your audit? Consider your discussion of the analytical procedures results, comments on the common-size statement and as well as your preliminary estimate of materiality. Prepare a memorandum to Suzie Pickering, Audit Senior, outlining potential problems areas (that is, where possible material misstatements in the financial report exist) and any other special concerns (for example, going concern). Specify the accounts and related assertions that would require particular attention. (10 marks).
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