Super-E Inc. (SI) manufactures component parts and sells them to major electronics companies. SI is a public company that reports under IFRS.

Fiscal 2019 was a year of growth for SI. It launched several new product lines, and so far, these products have been a success. During the year, SI experienced revenue growth and an increase in market share. The CEO was very satisfied, as her main goal for 2019 was to improve profitability. She is very focused on share price and earnings per share, and she tends to reward decisions that she believes will improve these measures. She hopes that the increases in revenue and market share will soon trickle down to the bottom line.

The rapid growth has resulted in the internal audit department at SI being very busy. They have had to work overtime to implement appropriate internal controls as part of the processes for the new product lines and the changes in customer credit-granting policies. This challenge has been exacerbated by the fact that this department has been understaffed for much of the year.

You, CPA, are the external auditor for SI's December 31, 2019, financial statement audit. This is your firm's first year auditing SI; however, the predecessor's files suggest limited errors were identified in prior years.

Question 1.

Prepare a assessment of risk of material misstatement at the overall financial statement level for the 2019 audit.