(b)  Significant risks of material misstatement

Generally up to 1 mark for discussion of the accounting treatment, 1 mark for identifying the associated risk of misstatement, and 1 mark for materiality (to a maximum of 2½ marks per issue) for a maximum of four issues:

–  Revenue recognition
  –  Cash/foreign exchange
  –  Licence agreement
  –  Impairment of property, plant and equipment – political instability and regulatory issues
  –  Impairment of assets – effect of hurricane
  –  Provision/contingent liability regarding legal claim
  –  Repairs to properties damaged by hurricane

Maximum marks  10