Question Three 6 Marks) While auditing XYZ Ltd your audit senior discovered that six months ago XYZ had lent $1 million to ABC Pty Ltd, a private company owned by Henry Williams, XYZ CEO. These loans had been made at an unusually low interest rate and the details of the loans had not been disclosed in the financial statements. Further investigation has revealed that Henry Williams was able to have the loans approved as his brother and sister are members of the five person board of directors. You have also discovered that ABC Ltd has been experiencing severe cashflow problems and has been threatened with legal action by major suppliers who have been paid late. The CFO informed you that, in November 2020, Henry Williams contributed an additional $500,000 in equity to XYZ Ltd. (a) What is the key account and assertion that is most at risk of misstatement as a result of this fraud? (1 mark for account and 1 mark for assertion) (b) What is Henry Williams' incentive to commit the fraud? Justify your answer. (1 mark) (c) Which factors give Henry Williams the opportunity to commit the fraud? Justify your answer. (1 mark) (d) Which factors allow Henry Williams to rationalise the fraud? Justify your answer. (1 mark) (e) List one piece of additional evidence the auditors should collect to determine if a fraud is actually taking place? Justify your answer. (1 mark)