Company Name - JB Hi-fi LTD

• 1) Identify the major audit risk areas (at least 2) 
• 2) Explain the potential impact of the audit risk on the company's financial statements 
• 3) Detail the auditing procedures to verify the account balances impacted by the risk

Important: You are the independent or external auditors of the company and your 'job' is to express an opinion on the truth and fairness of the accounts.

Some business risks are material and relevant to the external audit but others e.g. shoplifting in a retail environment whilst important (to the business) would not be material from an external audit perspective.