For Each One of the Following Risk Factors Relating to Misstatements

question 3

Essay

For each one of the following risk factors relating to misstatements arising from fraudulent reporting, identify the appropriate category.
1.Inability to generate cash flows from operations while reporting earnings and earnings growth.
2.High degree of competition or market saturation, accompanied by declining margins.
3.High turnover of senior management, counsel, or board members.
4.Difficulty in determining the organization or individual(s) that control(s) the entity.
5.Strained relationship between management and the current or predecessor auditor.
6.Declining industry with increasing business failures and significant declines in customer demand.

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Definitions:

Giftedness

A term that denotes significantly above-average ability or aptitude in one or more domains, such as intellectual, creative, artistic, or leadership capacities.

Semantic Sophistication

The depth and complexity of understanding and using language, especially regarding word meanings and relationships.

Syntax

The set of rules, principles, and processes that govern the structure of sentences in a given language, especially regarding word order and punctuation.

Vocabulary

The set of words known and used by a person or group, or relevant to a particular subject.