The Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) Mutual Evaluation Report of Mauritius-July 2018 states: "At the country level, there is no shared understanding of money laundering and terrorist financing (ML/TF) risks facing the country... Financial institutions (FIs) demonstrated an understanding of ML/TF risks albeit at varying degrees, depending on size and level of sophistication of business operations."

(a) Discuss the impact that an adverse assessment report on the level of effectiveness of Mauritius' anti-money laundering and the combating of terrorist financing (AML/CFT) system may have on the financial services industry in Mauritius.

(b) Discuss how the supervisory authorities can improve the effectiveness of the AML/CFT system.