Identify what you consider to be the ‘key’ inherent risk factors that could have animpact on the audit of BHP Billiton Limited for the year ended 30th June 2016 and/or future audits. For each of the inherent risk factors identified, describe the risk clearly and state how and why you consider the issue may create the risk of potential material misstatement in the financial statements of BHP Billiton Limited for the year ended 30th June 2016 and beyond. You are expected to identify five (5) critical inherent risks. 2.Using the audit risk model, discuss briefly how each inherent risk you identifiedwill impact on the evidence mix for the planning of the audit of BHP Billiton Limited in the relevant segment of the audit. When referring to the balance between tests ofbalances, transactions and analytical procedures, indicate which main areas wouldbe critical and comment on the nature and extent of the testing in the relevant segment. PRESENTATION, USE OF APPROPRIATE REFERENCING CONVENTIONS, GRAMMAR AND SPELLING – Refer to the marking guide contained in Appendix four and guidance notes in Appendix 2.
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