When an auditor performs risk assessment activities and develops a business$-$based approach to auditing financing activities, $$

it is essential to understand how the entity chooses an investing strategy, and the types of financial instruments used by the entity

the auditor should be prepared to make recommendations pertaining to which arrangements should be refinanced

it is essential to understand how the entity chooses to finance an operating strategy, and the types of financial instruments used by the entity

it is essential to understand how the entity chooses a financing strategy, and the types of financial instruments used by the entity