AP8.1 (LO 1) Basic Assessing control risk and audit strategy As an audit manager at Gung & Ho, CPAs, you have been scheduled to serve as the discussion leader for an in-office training session on consideration of the internal control structure in a financial statement audit. Gung & Ho's audit practice consists of audits of privately owned companies and not-for-profit organizations. Required Prepare an outline of comments you plan to make to indicate similarities and differences in how each of the following items is handled under a primarily substantive approach versus a reliance on controls approach. a. Understand entity-level controls. b. Understand the flow of transactions. c. Identify what can go wrong (WCGW) for financial statement assertions. d. Identify relevant controls to test. e. Determine preliminary audit strategy. f. Perform tests of controls. g. Evaluate audit evidence, assess control risk, and reevaluate audit strategy (if necessary). h. Report internal control weaknesses to those charged with governance