Which of the following describes how we identify risks of material misstatements?
We obtain the risk matrix prepared by the entity's management and after assessing it we determine risks of material misstatements for the purpose of our audit.
We identify events and conditions that affect the susceptibility of an assertion(s) to misstatement and determine whether they give rise to risks of material misstatements, before consideration of any related controls.
We carryforward the risks of material misstatement identified in prior periods and challenge if they continue to be relevant.
We identify events and conditions that affect the susceptibility of an assertion(s) to misstatement and determine whether they give rise to risks of material misstatements, considering also the related controls. This approach allows us to assess the risk landscape anew for each audit, taking into account any changes since the previous period and the specific circumstances of the entity being audited.
