Daicos Ltd is a public company that competes in the highly competitive market for manufactured household products.

The company is dominated by Peter Daicos, the chairman and chief executive officer, who has guided the company since it was a private company and has extensive influence on all aspects of company operations.

Peter is known to have a short temper and in the past has threatened individuals in the accounting department with no pay rise if they failed to help him achieve company goals. Furthermore, the company has extended its influence over customers and has dictated terms of sale to ensure that customers are able to obtain desired quantities of their most popular products.

Bonuses based on sales are a significant component of the compensation package for individual product sales managers. Sales managers who do not meet sales targets three quarters in a row are often replaced.

The company has performed well up until COVID-19 eventuated and now the company is having difficulty moving inventory in most product lines as retailers have difficulty selling in a down economy.

Required

(a) Identify the fraud risks factors that are present in the case above.