Luxury Furniture exports premium fabric and leather modular lounges to Japan. These lounges are transported to Japan on charter vessels, which make an average of one trip a month. Border restrictions and stricter checks by Australian custom officials have delayed several shipments of lounges. These delays have angered Japanese customers who are threatening to deduct 30% from the amounts owing as compensation for lost sales during the festival period. Some major customers are also threatening to not purchase any lounges from Luxury Furniture in the near future and instead expand imports of fabric and leather modular lounges from New Zealand. During the period, the Australian dollar has remained steady against the Yen, although it fell by about 7% against the US dollar. Debtors are invoiced in $US at the time of shipment,and pay in $US one month after the shipment is received. It takes around six weeks for the charter vessels to travel from Australia to Japan. A recent downturn in the Japanese economy is affecting forward orders, which have fallen by 17%.

Identify key account balances from the information provided that are subjected to an increase in audit risk. Briefly explain what factors increase the audit risk associated with the four (4) account balances identified. In your explanation, please mention the key assertion(s) at risk of material misstatement for each account balance identified.