You have recently completed your Bachelor of Business Degree - Accounting Stream at MIT and now working as a graduate auditor for a major accounting firm, Ernie and Youngster (EYS). EYS has just won the tenders for the financial report audits of the following ASX listed top 100 companies (as at 1 April 2020).

Company name: Abilene Oil and Gas Ltd

ASX code: ABL

Sector: Energy

ASX listed companies.

Required

For your chosen client , address the following six areas.

1. General and industry-specific economic trends and conditions
2. Competitive environment
3. Product, customer and supplier information
4. Technological advances and the effect of the internet
5. Laws and regulatory requirements.
6. Other area

Part 2: Risk of Material Misstatement (Inherent Risk) at the Financial Report Level

From your Understanding of the Client (i.e., Part 1), identify one(1) specific account balance (not account classifications!) that you consider at significant risk of material misstatement. For your chosen account balance:

a)Explain why the account balance is at significant risk of material misstatement

b)Explain one, key assertion at risk of not being valid

c)Detail one (1) relevant substantive audit procedure to address the assertion at risk as identified in b) above

d)Detail one (1) relevant practical internal control that would mitigate the risk in relation to the assertion at risk as identified in b) above.