Case B Impairment Indicator Related to a Potential Asset SaleAn entity owns a long-lived asset group (the "Asset Group") that management evaluated for impairment indicators in the current year in accordance with ASC 360 and concluded that there were no such indicators. As part of its risk assessment procedures, the engagement teamidentified the following risk of material misstatement related to the valuation assertion:

The entity does not identify relevant impairment indicators related to ASC 360-10-35-21(f), which states an impairment indicator may exist if there is "a current expectation that, more likely than not, a long-lived asset (asset group) will be sold or otherwise disposed of significantly before the end of its previously estimated useful life." The risk of material misstatement was not identified as a fraud risk. Note that t he engagement team may have identified additional risks of material misstatement related to the valuation assertion identified as part of its risk assessment procedures; however, this example focuses on this specific risk of material misstatement for illustrative purposes.The engagement team obtained the following evidence from the audit procedures performed to address this risk as well as evidence from audit procedure performed in planning and risk assessment:

The budget used by management for operational purposes is reasonable and indicates operating income and positive cash flows for the Asset Group.

Because they are in a distressed industry, the entity and the Asset Group have experienced declines in financial results in recent years.

Management communicated to investors an intention to shift its operating strategy to improve cash flows and is exploring options and opportunities to achieve this goal.

Board meeting minutes indicate that a number of strategic options and opportunities have been discussed, including the potential sale of the Asset Group, the potential sale of other assets, and refinancing debt.

The entity projects that it will meet its financing and liquidity needs without having to sell the Asset Group or any other assets.

Management represented to the engagement team that it does not believe it is more likely than not that the Asset Group will be sold or disposed of significantly before the end of its previously estimated useful life.

Write a memo on these questions.