Gain an understanding of the nature of the entity and its
Gain an understanding of the nature of the entity and its industry and then identifykey business risks. After this is completed, assess where the risks of material misstatements could be in the financial report. Consider the factors affecting bothInherent Risk and Control Risk. Finally, apply the Audit Risk Model [AR = f (IR,CR, DR)] to the selected company. Which risk rating would you apply (Low, Mediumor High) to the companys inherent risk assessment and control risk assessment?How does this affect your assessment of Detection Risk and Audit Risk?Perform analytical procedures of the Statement of Financial Position and of FinancialPerformance over the last three years using appropriate ratios and/or metrics. Selectfour key ratios and provide a brief explanation in the report. This should bepresented in a table format.Discuss with your group members which account balances are considered material.Explain how you calculated materiality for planning purposes and provide appropriatejustification for your decision-making.