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I decided to look at an past paper and the exam answer sheet on ACCA global’s website so now I have a feel for how to answer the question.
Okay, I took that from someone’s notes for that class as I missed it so I hoped it was a mistake as our lecturer’s handwriting is sometimes illegible. But with regards to the second part. That answer seems like a comment on the FS and seems acceptable as a response to a question about ROMM but not audit risk. Nothing speaks to the not being able to detect. How would I rephrase this as a response to an audit risk question? I find I learn better with a practical example.
I’m still a tad confused. For a question done which asked for the audit risks the lecturer gave the following response:
“*Audit risk states controls are weak*
Provisions may be understated if the company has suffered litigation for loss of customer data or if the company was fined for non-compliance with the data protection act.”
This answer sounds like RoMM as it speaks to the effect on the financial statement. Could you indicate if my thinking is correct and a possible way to restate to answer the audit risk question?