An entity does not have a legal officer to monitor updates to the regulatory environment of the entity. The audit team has found that the entity seems to learn about updates to legislation, or about the introduction of new laws relevant to the entity, from the auditors. Which risk below is an audit risk that most closely relates to the matter noted?

A: Risk of incorrect balances in the financial statements.

B: Risk of non

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compliance with laws and regulations and its impact on the financial statements.

C: Risk of late submission of statutory reports to the regulators by the entity.

D: Risk of penalties raised by the regulator for noncompliance with laws and regulations