Client Acceptance and Risk Assessment $(20$ Marks$)$ You are the senior partner at MTS Chartered Accountants, a medium$-$sized audit firm based in South Africa. Your firm has recently been approached to take over the external audit of Orion Tech Solutions $($Pty$)$ Ltd$,$ a newly listed entity on the Johannesburg Stock Exchange $($JSE$).$ Orion Tech Solutions $($Pty$)$ Ltd is a rapidly growing technology company that develops and distributes smart home devices, wearable fitness trackers, and wireless networking solutions. It serves a mix of domestic and international customers and has recently expanded operations across Johannesburg, Pretoria, Bloemfontein, and George. The company's financial year$-$end is $30$ June $2022,$ and it has requested that your firm complete the audit engagement in time for the annual general meeting scheduled in late September. However, several concerning facts have come to light during preliminary discussions: $$ Revenue Growth & Bonus Scheme: The company has shown a sudden and significant increase in revenue. This appears to be linked to a new executive bonus plan that rewards management with a percentage of revenue that exceeds budget by $20\%,$ raising the risk of revenue manipulation. $$ Cash Transactions: Local sales staff are unofficially encouraged to accept cash payments, rather than bank transfers or card payments, to "speed up collections," raising potential concerns regarding fraud, money laundering, or misappropriation of funds. $$ Change in Accounting System: Due to rapid expansion, Orion recently transitioned from a manual accounting system to a computerised off$-$the$-$shelf system, managed by a newly hired IT manager with minimal experience in accounting or systems controls. $$ Legal and Financial Instability: Orion recently lost a legal dispute involving intellectual property infringement, resulting in a substantial financial penalty. This has caused liquidity concerns and may impact the company$$s ability to continue as a going concern. $$ Resignation of Previous Auditor: The previous external auditor resigned after an alleged dispute with management. Management has refused to allow your firm to communicate with the outgoing auditor, despite standard professional protocol. REQUIRED: As the senior partner, you must conduct a thorough risk assessment and perform due diligence before accepting the audit engagement. $1\mathrm{.}1\mathrm{.}1$ Identify and explain the key risk factors your firm must assess before deciding whether to accept Orion Tech Solutions $($Pty$)$ Ltd as a new audit client. Refer specifically to facts from the case. Mark breakdown: $-$ Identifying $(5$ Marks$)-$ Explaining $(5$ Marks$)(10$ Marks$)$ Use this format for answering. Key Risk Explanation