Your manager requires you to change the accounting policy on the fixed asset valuation in order to reduce a negative impact on profits. While the policy is inappropriate based on accounting standards, the manager argues that other companies are using it. What type of fraud is this? What is the fraud risk factor? 2points

Explain why 'significant debt/equity ratio' is an indicator of a going concern risk. 3points

Explain why 'loss of significant customers, or supplier problems' is an indicator of a going concern risk. 3points

Why is an auditor interested in identifying related parties during the risk assessment phase of an audit? Give two reasons. 3points