Case Study Question on Accounting and Auditing: Background: ABC Corporation is a manufacturing company with a diverse product line. The company has recently experienced rapid growth, expanding its operations both domestically and internationally. As a result, the management of ABC Corporation is keen on ensuring the accuracy and reliability of its financial statements to meet the expectations of stakeholders. Case Scenario: During a routine internal audit, the internal audit team at ABC Corporation identifies potential areas of concern, including discrepancies in inventory valuation, revenue recognition, and the accounting treatment of certain long-term contracts. The external audit firm, engaged to conduct the annual audit, is made aware of these findings. Additionally, the company has recently adopted new accounting standards that impact the recognition and measurement of certain financial instruments. The management of ABC Corporation is seeking assurance that their financial statements are in compliance with the latest accounting standards and that any potential misstatements are addressed promptly. Case Study Question: Considering the information provided in the case scenario, discuss the key challenges faced by ABC Corporation in ensuring the accuracy and reliability of its financial statements. Identify the specific areas of concern and potential implications for the company's financial reporting.