Identifying and Assessing Risks of Material Misstatement and Cloud9 Case Study documents as a guide to assist in answering the following questions. For each of the responses and topics discussed above by the CFO, you should work through this process: 1. Identify the potential risks within each Cloud9 process (e.g. What could go wrong?) 2. To help identify risk, refer to your work on financial statement assertions to help formulate the risk. For example: A. How do I know all transactions are captured? B. How do I know the transaction stated in the interview is valued correctly? C. What secondary reviews are performed? 3. For each potential risk, define the level of uncertainty and estimate its impact on the financial statements based on materiality. To do this, review the company's financial statements. 4. Determine the controls or lack of controls that are currently in place based on the information on any further control measures that may be required. To do this, A. Review internal control best practices for each area (e.g., accounts receivable, accounts payable, inventory, and IT controls). 5. See questions to consider in the supporting financial statements.

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