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Read a memo that identifies 4 risks based on (a) the prioryear 10k (b) minutes from the board meetings and (c)

Case 1: Apollo Shoes Case-Fraud Risk Assessment Assignment
Due Oct 4th by the beginning of class. One group member submits through Blackboard.
Perform a Fraud Risk Assessment and Fraud Brainstorming Session
Read the following Apollo documents (on Blackboard as Apollo Planning Files): (1) the prior-year 10-K,
(2) minutes from the board meetings, and (3) the financial statements. Then, meet together as a group and
brainstorm the company’s fraud risks.
Based on the list of fraud risks you brainstorm, write a memo that identifies several fraud risks. For each
risk, explain how you found the risk and why the risk is important to consider.
The following page is a template you can use to write your memo. I have added the first fraud risk. Add at
least five more. A-6
To: Apollo Audit Files
From: Team # 1
Julio Rodriguez, Senior JR
Aneisha Jones AJ
Omar Salah OS
Jenny Brown JB
Date: October 4, 20X3
To document our understanding of the company’s risk of material misstatement due to fraud.
Our team met on October 4, 20X3 for a fraud brainstorming session. Prior to the meeting, team members
reviewed the company’s prior-year financial statements, board minutes, and current-year financial
As a result of the meeting we identified a number of risk factors. For each risk factor we discussed
information that is necessary to assess fraud risk and assessed each risk factor as high, medium or low.
The key risks are as follows: Risk #1-Improper revenue recognition. Improper revenue recognition is presumed to be a fraud
risk on all audits because of several methods of artificially inflating revenue. However, evidence
in the board minutes suggests that Apollo’s CEO appears to have a significant focus on earnings,
which indicates a relatively high potential for aggressive revenue accounting.
Risk #2-[List a fraud risk. Then elaborate on the risk, including where/how you found it.]
Risk #3Risk #4Risk #5Risk #6- [and so on for additional identified risks you want to highlight] Conclusion:
Throughout the audit we will assess audit evidence, communicate with the audit committee, and continue
to assess our audit plan. The results of our fraud assessment will continue to be updated in the audit files
throughout the engagement.