You are currently carrying out risk Assessment procedures at your client Mancosa (Pty) Ltd, a manufacturing company and subsidiary within an industrial conglomerate. The following information pertains to this assessment: 1. The financial director has been very evasive in answering questions, generally displaying a very dismissive attitude toward the audit. 2. Some of the products manufactured by Mancosa (Pty) have not kept up with market requirements. 3. In prior years directors' annual bonuses were based upon earnings reflected in the audited financial statements. This policy has been abandoned and directors' monthly salaries have been increased. 4. The company decided to retrench its internal auditors in a cost cutting exercise, and the holding company internal auditors will be available if required. 5. Close to the end of the year a number of complex entries relating to asset revaluations were put through. 6. For the six weeks prior to year-end, the credit controller was absent from work due to ill health. During this period a number of employees in the section took over his duties, for example authorizing credit terms, passing credit notes, etc. 7. Management is regarded by the staff as being very dictorial as certain members of management will frequently override controls. Some staff members have expressed the view that the holding company puts too much pressure on management to perform. 8. Numerous transactions take place with other companies within the group. 9. Although Mancosa (Pty) have a sophisticated computerized accounting system, they have a significant number of end user computing, and they perform a host of calculations, reconciliations, and spreadsheets to complete the monthly financials. 10. Due to the reduced number of staff, the financial manager requested that four more users were made super users to streamline the turnaround time of processing transactions. You are required to: Indicate whether each of the above will increase or decrease your assessment of the risk of material misstatement. For each also indicate if the risk of misstatement is at financial statement or assertion level. You are not required to consider the information collectively, nor give reasons. (10) Answer layout 1. Increase risk at financial statement level