ACFI3005 Auditing and Assurance- prevent and detect potential errors

Assume you are one of the audit team members who will conduct the financial report audit – year ending 30 June 2021 – for Sportastic. Using the company’s information given above, prepare a report dated June 15, 2021 for the audit manager outlining the audit plan. As it is the beginning of the audit do not prepare a final audit report/opinion. The report should cover the following areas under the suggested headings:

1. Risk Assessment 

From the background information given above:

1. identify and explain three (3) potential HIGH inherent risks. For each risk listed, identify the associated financial accounts and key assertions that would be affected. 
 
2. Identify and explain three (3) potential HIGH internal control weaknesses (control risks). For each weakness, identify the associated financial accounts and assertions, and suggest controls that can be implemented to prevent and detect potential errors.