Section B - Question 11 is compulsory and MUST be attempted - 15 MARKS IN TOTAL FOR SECTION B Question 11 You are an audit manager in a small firm of chartered certified accountants, Pricey & Co. Annual revenue for Pricey & Co is around 5.0 million. Lee Newman, the senior partner at Pricey & Co, is a very good friend of Stuart Baron, the Chief Executive of Excellent Electrics Ltd, a local wholesaler which sells small electrical items to many shops in the area. Pricey & Co have been asked to accept the appointment of external auditors for Excellent Electrics Ltd for the year ended 31 March 2021. Lee Newman has asked you to perform any necessary work before taking up the offer and has provided you with the following information: 0) Lee sees this as a great opportunity to increase revenues of Pricey & Co particularly as Excellent Electrics Ltd are planning to takeover one of their major rivals who operate at a national level. it) Several members of staff of Pricey & Co were recently seconded to Excellent Electrics Ltd to perform a variety of accountancy tasks and one member of staff acted as the firm's Director of Finance for six months last year. I II) Fees for the audit are expected to be around 450,000 but these could rise to 900,000 if the takeover goes ahead. iv) Stuart Baron has suggested that, if Pricey & Co take over the audit, Lee Newman should take a two-week holiday in his villa in Florida as a 'thank you'. V) Excellent Electrics Ltd have not provided any information on how their planned takeover is to be financed. Excellent Electrics Ltd appear to be in financial difficulty: Stuart Baron has advised Lee that they have recently struggled to pay bills on time and several suppliers have stopped dealing with them. Required Identify the professional and ethical risks that this proposed appointment would present and set out possible safeguards