For the restaurant industry Analyze the risk factors and select the top three you feel pose...

For the restaurant industry

Analyze the risk factors and select the top three you feel pose the greatest risk of a possible material misstatement,

Select the one you feel poses the least risk for a material misstatement and

Explain the reasons.

Solutions

Expert Solution

If we talk about restaurant industry, there are different types of risks and challenges here like-

Shifting of customer due to price policy
Compromise with quality in case of excess workload because of more human work than any other organisation
Maintainting integrity and reputation
Maintaining the hygenic condition for employees and customers as a whole
Getting and retaining qualified and expert staff is a challenging and important task here
Keeping confidentiality

There are challenges and risks in this business as discussed above, the most important risk here can be-

Daily reciepts, discounts and special offers can be a area of material misstatement
Maintenance expenses is also a area of material misatement in the restaurant industry
Stock variation and pilferage is also a area of material misstatement here

Although there are very challenging risks as well there are some things which are under control of the organisation also, can said to be less challenging-

Rental expenses and other fixed costs

ekkarill92 answered 1 year ago

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