Bohrer cpa is considering the following factors

Bohrer, CPA, is considering the following factors in assessing audit risk at the fi nancial statement level in planning the audit of Waste Remediation Services (WRS), Inc.'s fi nancial statements for the year ended December 31, 2015. WRS is a privately held company that contracts with municipal governments to close landfills. Audit risk at the financial statement level is influenced by the risk of material misstatements, which may be indicated by factors related to the entity, management, and the industry environment.
1. This was the fi rst year WRS operated at a profi t since 2010 because the municipalities received increased federal and provincial funding for environmental purposes.
2. WRS's board of directors is controlled by Tucker, the majority shareholder, who also acts as the chief executive officer.
3. The internal auditor reports to the controller and the controller reports to Tucker.
4. The accounting department has experienced a high rate of turnover of key personnel.
5. WRS's bank has a loan offi cer who meets regularly with WRS's CEO and controller to monitor WRS's fi nancial performance.
6. WRS's employees are paid biweekly.
7. Bohrer has audited WRS for fi ve years.
8. During 2015, WRS changed its method of preparing its fi nancial statements from the cash basis to generally accepted accounting principles.
9. During 2015, WRS sold one half of its controlling interest in Sanitation Equipment Leasing Co. (SEL). WRS retained a signifi cant interest in SEL.
10. During 2015, litigation fi led against WRS in 2005 alleging that WRS discharged pollutants into provincial waterways was dropped by the province. Loss contingency disclosures that WRS included in prior years' fi nancial statements are being removed for the 2014 fi nancial statements.
11. During December 2015, WRS signed a contract to lease disposal equipment from an entity owned by Tucker's parents. This related party transaction is not disclosed in WRS's notes to its 2015 fi nancial statements.
12. During December 2015, WRS increased its casualty insurance coverage on several pieces of sophisticated machinery from historical cost to replacement cost.
13. WRS recorded a substantial increase in revenue in the fourth quarter of 2015. Inquiries indicated that WRS initiated a new policy and guaranteed several municipalities that it would refund provincial and federal funding paid
to WRS on behalf of the municipality if it failed a federal or provincial site inspection in 2016.
14. An initial public offering of WRS stock is planned in 2016.
REQUIRED
For each of the 14 factors listed above, indicate whether the item would likely increase audit risk, decrease audit risk, or have no effect on audit risk.