Worksheet - Identifying fraud risks 506 Page 5 of 5 WIP CAS ref. Findings/comments ref. on a timely basis, and Scope restrictions, frequent disputes or unreasonable demands placed on us as auditors. Whenever a fraud risk is identified, record it on the fraud risk register (Form 522 or its equivalent). Note that fraud risk factors cannot easily be ranked in order of importance. Assessing the risks of material misstatement due to fraud requires the exercise of professional judgment. 15. Revenue recognition Carmelo's need additional Based on the presumption that there are risks of fraud in revenue recognition, bank debt to build a evaluate which types of revenue, revenue transactions or assertions give rise second facility near the to such risks wine shop on their If the presumption is not applicable, document the reasons for that conclusion. property. They also need to maintain debt covenants for its current financing. Additionally, there are related party transactions in this case These reasons can all result in fraud revenue recognition.| Prepared by Janet Walker Date July 21 2022 Reviewed by Date