2 During audit planning an auditor obtained the information found below. Read the requirements Select Yes or No in the first column to show whether each item indicates an increase risk for fraud. Use the second column to identify which fraud condition (incentives/pressures, opportunities, or attitudes/rationalization) is indicated. (Complete all input fields. Select "N/A" in the "b. Fraud Condition' column if the information does not indicato a fraud risk.) a. Fraud Information risk b. Fraud Condition Significant operations are located and conducted across International borders in 1 jurisdictions where differing business environments and cultures exist. There are recurring attempts by management to justify marginal or inappropriate accounting on the basis of materiality The company's controller works very hard, including evenings and weekends, and 3. has not taken a vacation in two years. The company's board of directors includes a majority of directors who are 4. Independent of management Assets and revenues are based on significant estimates that involve subjective 5. Judgments and uncertainties that are hard to corroborate. The company is marginally able to meet exchange listing and debt covenant requirements The company's financial performance is threatened by a high degree of competition and market saturation New accounting pronouncements have resulted in explanatory paragraphs for consistency for the company and other firms in the Industry The company has experienced low turnover in management and its internal audit function. 6 7 8 9