Wendy Chua is a senior auditor and involved in the audit for the year ended 31 December 2021 of WaterFast Technologies, a Singapore based manufacturer of battery powered engines for luxury super yachts. WaterFast's operations are financed by a combination of long-term loans and short-term lending facilities from SBD Bank Corp, and private equity placements.

As part of the audit planning process Chua has identified the following matters:

• WaterFast has been moderately profitable for several years and has recently successfully expanded its operations to manufacture a new type of engine for export to Australia. Interest has been strong and the margins on this new engine will be higher than existing engines.
• One of WaterFast's biggest customers, Desla Luxury Watercraft, which represents 33 per cent of WaterFast's annual sales, has indicated that it has started to manufacture its own engines in propriety Giga factories.
• The strength of the Singapore dollar against foreign currencies has had an adverse effect on demand for locally produced engines. Competition in the industry is becoming more intense, with some other customers of WaterFast indicating they may now purchase their engines from Guangdong based suppliers at a much lower cost.
• SBD Bank has requested cash flow forecasts for the coming year to review financing arrangements. WaterFast's overall level of debt and the debt to equity ratio have remained stable in recent years. However, the current ratio has recently weakened due to a large increase in creditors. Cash flow from operations to 31 December 2021 was strong.

Required:

To assist Chua, Identify and discuss any events or conditions that may indicate material going concern uncertainties and any mitigating factors with respect to WaterFast Technologies.