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maam I find this thing little bit concerning, for example if there are two audit risks stemming from one scenario, like cut off of purchases can be an audit risk and trade payables and inventory being understated can be another, when responsibility for goods in transit (for upto a month) passes to the customer from point of dispatch.
in this case are we required to identify both risks to gain 1 mark? or just talking about inventory and payables being understated is enough?
There is no requirement to identify EVERY risk – that why the examiner specifies a number and the answer shows more than that number to illustrate the range of acceptable risks.
okay got your point ma’am!
So can I break the two points I mentioned above into 2 risks and their corresponding responses? to get 4 marks?
If the risk of understatement is due to cut-off error that is just one risk – understatement is the effect and cut-off error is the cause.