Risk Factors Relating to Misstatements ARisk Factors Relating to Misstatements Arising from Fraudulent Financial Reporting

Risk Factors Relating to Misstatements Arising from Fraudulent Financial Reporting

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Incentives/Pressures

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Opportunities

The nature of the industry or the entity’s operations provides opportunities to engage in fraudulent financial reporting that can arise from the following:

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The monitoring of management is not effective as a result of the following:

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There is a complex or unstable organisational structure, as evidenced by the following:

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Internal control components are deficient Deficiencies in internal control as a result of the following:

 Inadequate monitoring of controls process to monitor the entity’s system of internal control, including automated controls and controls over interim financial reporting (where external reporting is required).

 High turnover rates or employment of staff in accounting, information technology, or the internal audit function that are not effective.

 Accounting and information systems that are not effective, including situations involving significant deficiencies in internal control.

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Attitudes/Rationalisations

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