Fraud Risk Factors Bond, CPA, is considering audit risk at the financial statement level in planning the audit of Toxic Waste Disposal (TWD) Company's financial statements for the year ended December 31, 20X1. TWD is a privately owned entity that contracts with municipal governments to remove environmental wastes. Audit risk at the financial statement level is influenced by the risk of material misstatement, which may be indicated by a combination of factors related to management, the industry, and the entity. During the required discussion among engagement personnel regarding the risks of material misstatements due to fraud, the following risk factors for TWD Company were recorded. For each risk: choose whether the risk is indicative of: incentive (risk factor that creates incentive or pressure for management and others to commit fraud); opportunity (risk factor that provides the opportunity for fraud to be perpetrated); or rationalization (risk factor that indicates a culture or environment that enables management to rationalize committing fraud). choose the mitigating control from the list that would address the fraud risk factor and reduce the susceptibility of the entity’s financial statements to material misstatement due to fraud. Choose "No mitigating control" if none of the controls is appropriate for that risk factor. Controls may be used more than once or not at all.