Question: Required: Select a public company and determine a significant risk that could affect its financial statements. Go to the EDGAR database at sec website and select the company's form 10-K (a public company that interests you). The 10-K will have a list of risk factors the company faces. Describe the risk and how it could affect the financial statements, including what assertions might be misstated. Prepare an audit strategy memorandum for the risk describing what controls the company might use to mitigate the risk, how you could test the controls, and what substantive procedures you might use to determine whether there is a misstatement.
Once you gain an understanding of the business and have identified sources of risk, you should be able to piece together which assertions are relevant, and which test of controls and substantive procedures you may want to focus on. Please stay focused in one or two areas.