TechPlus Ltd$,$ a mid$-$sized technology firm specializing in software development and AI solutions, recently expanded by acquiring patents, trademarks, and software licenses, increasing the risk of financial misstatements. XYZ Audit Firm is auditing TechPlus Ltd$$s financial statements for the year ending December $31,2024.$

During audit planning, the team follows ISA $530($Audit Sampling$)$ to select representative samples and ISA $230($Audit Documentation$)$ to maintain proper audit records. A client risk assessment was conducted, considering revenue recognition, intellectual property valuation, and regulatory compliance risks.

To enhance audit effectiveness, TechPlus Ltd$$s management provides written representations affirming financial accuracy and compliance. The audit firm also employs Computer$-$Assisted Audit Techniques $($CAATs$)$ to analyze large datasets and test internal controls.

$1.$ TechPlus Ltd has acquired new patents, trademarks, and software licenses, making intangible assets a significant part of its financial statements. Given the complexities of valuation and recognition, what are the key risks of misstatement related to these intangible assets? $(5$ marks$)$

$2.$ During the audit of TechPlus Ltd$,$ XYZ Audit Firm must select appropriate sampling techniques to test financial statement balances. Outline five sampling techniques that auditors can use in this context. $(5$ marks$)$

$3.$ ISA $530($Audit Sampling$)$ is critical in minimizing audit risks. In the context of TechPlus Ltd$$s audit, explain the terms $$sampling risk$$ and $$non$-$sampling risk$$ with examples. Additionally, briefly explain how XYZ Audit Firm can control these risks. $(5$ marks$)$

$4.$ To comply with ISA $230($Audit Documentation$),$ the audit team at XYZ Audit Firm prepares detailed audit working papers. List the key purposes of audit working papers in the context of TechPlus Ltd$$s audit. $(5$ marks$)$

$5.$ Before accepting TechPlus Ltd as a client, XYZ Audit Firm conducted a client risk assessment. Identify factors that indicate whether TechPlus Ltd is a high$-$risk or low$-$risk client. $(12$ marks$)$

$6.$ What is meant by Written representations? What are the matters to be included in the written representations?$(8$ marks$)$

$7.$ XYZ Audit Firm utilizes Computer$-$Assisted Audit Techniques $($CAATs$)$ to enhance audit efficiency while reviewing TechPlus Ltd$$s financial records.

a$)$ List the benefits of employing CAATs in an audit.$(6$ marks$)$

b$)$ Define the terms "audit software" and "test data" in the context of CAATs. $(4$ marks$)$