MEDIUM Chic Fashions Ltd is a national retail chain with stores located throughout Australia. Chic Fashions specialises in expensive womens summer clothing. The garments are designed in Australia and manufactured in China from European-sourced fabrics. The availability of competitor products on low-price internet shopping sites, combined with the relatively high Australian dollar, has resulted in several fashion houses closing down. This industry-wide decline in sales has resulted in continuing cash ow problems for Chic Fashions.

Identify and explain four industry-specic factors that are important when gaining an understanding of the entity and its environment to assess the nature of the risks for the audit of Chic Fashions.