PRACTICAL CASES – AUDIT COURSE

RISK ANALYSIS AND INTERNAL CONTROL

I. Exercise 1
Questions
Indicate whether the following statements are true or false.

1. Risk analysis concerns only the auditor.

The organization of a company depends only on the choices of

management of executives.

3. Every activity involves risks.

4. The risk related to control depends on the inherent risk.

Responses
False: the company leaders must have analyzed the risks to
mettre en place les mesures adéquates.

False: the organization set up by the leaders also depends on

from their analysis of inherent risks related to the activity or to its
environment.

3. True: any activity involves risks. Risk analysis is

unmissable.

4. True: it is based on the identified inherent risks that the company

establish controls that are not themselves exempt from
risks.

II. Exercise 2
Statement
A company manufactures dietary prepared meals. It sells its products to
merchants and recently opened a direct sales store.
Work to be done
In the following situations, what inherent risk do the measures address?
prizes?
Access to food storage areas is prohibited to all
foreign person to the service.

2. Access rights to the software are protected by passwords.

3. The counting of cash in the register must be done every day.

At the end of the production line, the products undergo a quality control.
quality.

Corrected
Identification of inherent risks
1. Access to food storage areas is prohibited for everyone.
foreign person to the service: respect for hygiene rules and risks of
loss of goods, to reduce the inherent risk of activities
using food products.

2. Access rights to the software are protected by passwords:

confidentiality and integrity of stored data. Poor management
of rights can compromise the separation of tasks when a
no one can have incompatible rights (to command,
receive, account for, and process for payment.

3. The counting of cash in the till must be done every day: risk
of flight, inherent risk due to the presence of species.

At the end of the production line, the products undergo a quality control.
qualité : risque de mal façon, risque de litige avec les clients, coût du
after-sales service, implementation of the warranty, inherent risk in any
industrial production activity.

III. Exercise 3
Questions
Indicate whether the following statements are true or false.

The assessment of internal control is necessary in all missions.

of audit.

2. In the absence of written documents, the analysis of procedures cannot be implemented.

A conformity test aims to verify the conformity of a
procedure with the management decisions.

4. The statutory auditors can provide an assessment on any

procedure set up in a company.

Responses
1. True: the assessment of internal control is necessary in all
audit missions because it helps to identify risk areas, to assess
the risk of anomaly in the accounts and to anticipate, if necessary, some
enhanced account controls.

False: in the absence of written documents, it is always possible to have things explained.
a procedure and to test it to verify that it has been correctly
described and how it is applied.

3.False: a compliance test aims to verify that a procedure

is applied as it was intended.

4. False: auditors cannot make an assessment

that regarding the procedures related to accounting treatment and
the preparation of financial information. They do not have skills
in other areas.

IV. Exercise 4
Statement
An industrial company has set up a perpetual inventory
extra-accounting of raw materials. The current procedure provides for:

at the entrance of raw materials, reading the supplier's barcode

by the warehouse clerk who receives the products and modifies the information
contained in the barcode, validated by the warehouse manager.
A label is placed on the packaging to indicate the address of
storage (the warehouse is divided into several zones);

upon exit, if it is a whole batch: reading of the barcode if it is a

of a partial output: reading of the barcode and modification of the
quantity.

During the physical inventory, discrepancies are noted and analyzed.

Work to do
The auditor who certifies the accounts of this company is-
Is he/she concerned by this procedure?

2. What tests can you propose to verify the reliability of this

Procedure? (The description of the tests is not required.)

Corrected
The auditor who certifies the company's accounts.
industrial is concerned with the procedure for material stocks
first in that this procedure will have an impact on the
valuation of stocks at closing.

2. To test this procedure, one can check that:

the warehouse manager effectively validates the information

modified upon entry into stock;

the storage location matches the labels affixed on the

packaging

the remaining quantities in stock correspond to the quantities of

the perpetual inventory for partial outputs;

The discrepancies during the inventory taking are indeed analyzed.

ORGANIZATION AND PRACTICE OF AUDIT

I. Exercise 1
Questions
Indicate whether the following statements are true or false.

Foundations have the particularity of not having a general assembly.

The annual accounts are approved by the board of directors.
He is the one who appoints the auditor.

2. In case of omission to appoint a statutory auditor, any

an interested person may seek in court the appointment of a
auditor.

3. An auditor retires in 2018. His term

should be completed in 2022. A new auditor must be appointed
appointed in 2018 for four terms.

4. The mandate of the alternate auditor covers the same

period than that of the holder.

5. The AMF can intervene to refuse the appointment of a commissioner to the

accounts of an entity publicly soliciting savings.

Answers
1. True: it is the body responsible for approving the accounts that appoints the
auditor (unless designated in the statutes).

2.False: only the members of the general assembly (or equivalent body)
can make this request.

3.False: at the retirement of an auditor, the substitute,

if it exists, or another partner takes over until the end of the term in
2022. If necessary, a new alternate auditor
must be named.

4. True: the mandate of the alternate auditor begins and ends

ends at the same time as that of the holder.

False: the AMF can make observations but has no power to

decision.
II. Exercise 2
Questions
Indicate whether the following statements are true or false.

A new auditor must contact his predecessor.

before accepting the mandate.

2. An auditor can resign before the end of his term.

mandate if an incompatibility arises.

3. The letter of assignment is only mandatory for contractual missions.

Answers
True: he must know the reason for the non-renewal of the mandate.

2. True: it is even an obligation.

3. False: the letter of mission is mandatory in the first year of the mandate.
of the auditor.

III. Exercise 3
Statement
A prospective auditor observes that the company that contacted him
is devoid of accounting procedures and the leaders seem to lack
de rigueur in the conduct of business. He deduces that the risk of anomalies
in the accounts is high and he refuses the mandate.

Work to do
Does he have the right?

Corrected
An auditor has the right to refuse an assignment if he considers
that the conditions for the smooth running of the mission are not met.
GLOBAL PRACTICAL CASE

Statement

To illustrate the course of an auditor's mission and

the different stages, you are invited to participate in the mission of
auditor of the hotel-restaurant "At the Black Tulip" for
the exercise 2016. The answers to the questions posed must primarily
refer to the situation that is proposed to you. The purely
Theoretical ones are very few.

History

The hotel was established in 1905 by Mr. Gaston FANFAN, great-grandfather of

the current general manager, with the purchase of a business fund. The buyout of the
the business assets of a restaurant have complemented the hospitality activity.
This hotel-restaurant is located in the city center, very easily accessible from
the station. The hotel's equipment has evolved regularly based on the needs
customer comfort requirements and technological innovations. But the
The style and decoration of the era have been preserved to maintain an atmosphere.
character, comfortable and warm.

The hotel has maintained its three stars for many years.
rooms are spacious, well equipped. Armchairs have been installed in
fitted corners in the hallways, which are just as many places where the
clients can relax, read or meet to exchange.
The restaurant offers simple, traditional, and high-quality cuisine.
in accordance with the hotel's atmosphere. The chef, Mr. CARDONS, is at
orders for about twenty years.

Clientele

The regular clientele consists of businessmen who appreciate

particularly the family character of the welcome. A clientele is added.
of tourists, coming from many countries, who enjoy discovering a
very French ambiance.

Direction - Legal Status

This hotel-restaurant has been managed since its creation by a family-owned public limited company.
of the administration. The president, Mr. Charles FANFAN, is the grandson of the
founder, and the general director, Mr. Guillaume FANFAN, the great-grandson.
All the other shareholders are close family members, uncles,
aunts, cousins.
Tensions between the different members of the family arise.
regularly, some questioning the amounts invested in the works of
renovation or development, considering that the dividends paid are
insufficient. The break was narrowly avoided during the discussions about the
buyout project of the restaurant. Some shareholders are threatening to sell
their actions, but they have never attempted to carry out these threats.
The buildings are the property of the SCI LAFRONDE of which all the partners
They are family members. A emphyteutic lease has been signed with the SA.

Current situation

Due to a very good location, the risk of takeover of this establishment

by a large hotel chain cannot be ruled out. Furthermore,
regardless of family tensions, the pressure from competitors is felt
to feel and the board of directors is not certain that it will always be in
measure to cope with future developments.
The hotel has 66 rooms, the restaurant has 40 tables. The company
employs 24 employees and its turnover is 3,384 k€.
Most employees are young and the average seniority is less than
10 years.
Tensions between the president and the CEO are beginning to arise.
expressed by the staff, without having repercussions on the
quality of service provided to customers. Guillaume wants to modernize the
hotel management, resorting to subcontracting, considering that the label 'made
house" is not always a sufficient guarantee of quality or better.
cost.
Mr. Charles FANFAN's brother is a baker. He supplies the hotel and the
bakery restaurant, pastry shop, and occasionally in pastry.

Accounting organization

An accountant, employee of the public limited company, Miss ZIFFRE, records all the entries.
current accounts, it prepares the VAT returns and prepares the entries
of inventory.
The accountant, Mr. ASSET, has a mission to present the accounts.
annual. He and his collaborators intervene to establish the accounts
annual tax return and all tax declarations except VAT.
This mission is complemented by a social mission: establishment of
pay slips and all declarations related to personnel, except for the
unique hiring declaration as well as a legal secretarial mission
for the preparation of the general assembly and the required formalities.

Cash operations

The restaurant's cash register is under the responsibility of the head waiter, all the
servers have access to it. Operations are identified by a code assigned to
each of them, which allows for calculating the tips that are owed to them.
Cash summaries allow for the distinction between the
different modes of payment: check, cash, credit card, and ticket
restaurant.
The bar cash register allows for the detail of the turnover in 4 categories:
alcoholic beverages, non-alcoholic drinks, coffees and other hot drinks
(teas, herbal teas, etc.)
Cash receipts are not systematically deposited in the bank. They
used to do the shopping at the market and to pay for small expenses
of the interview.
Cash discrepancies, not exceeding a few dozen euros, are
consistently observed, without any solution being provided.

Extract from the permanent file: knowledge of the company

The specifics of the hotel industry are:

seasonality and the use of fixed-term contracts;

collective agreement for the hotel industry;
private clientele, cash receipts;
importance of fixed assets and maintenance work, provisions
for a major interview;
security and hygiene constraints.

The risks associated with these specificities are:

challenge to the continuity of operations;

the exhaustiveness of the recipes;
theft of consumables or small items;
distinction charges –immobilizations (work, renewal of the
dishware) ;
misappropriation of funds;
evaluation of customer receivables;
valuation of food stock;
non-respect de la convention collective.

Excerpts from the summary note concerning the accounts for the financial year
closed on December 31, 2015

Fixed assets: no physical inventory.

Receivables: numerous unpaid debts, the provision for doubtful receivables,
insufficient has been modified at the request of the auditor.
Safety commission control: an emergency exit must be
Setup. The cost could reach €250k.
 Inspection of the 'veterinary services': the wall coverings must
be redone, the freezers must be moved. The cost could
amounts to €70,000.

Financial situation: annual accounts fiscal year 2015

Balance sheet asset

(in thousands Value Amortized Value Value

euros brute ent
and
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31/12/201
nice
31/12/201
depreciation 5 4
Intangible assets 2,056 5 2,051 2,052
Tangible assets 477 280 197 115
Financial investments 76 76 74
Total fixed assets 2 609 285 2,324 2 241
Stocks 34 34 29
Accounts receivable 43 43 60
Other receivables 19 19 19
Availability 89 89 112
Charges incurred in advance 11 11 14
Total current assets 196 196 234
Total assets 2 551 285 2,520 2,475
Balance sheet liability

(in thousands of euros) Value Value

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31/12/201 31/12/201
5 4
Capital 525 525
Legal reserve 52 52
Report again -132 –304
Result 184 172
Total equity 629 445
Provisions 665 603
Total provisions 665 603
Financial debts 977 1 132
Supplier debts 45 98
Tax and social debts 84 78
Other debts (current accounts) 119 119
Products noted in advance 1
Total debts 1 226 1,457
Total liabilities 2,520 2,475

Income Statement
(in thousands of euros) Exercise Exercise
2015 2014
Revenue 3,349 3 305
Reversal of provisions 90 30
Total operating income 3 439 3 335
Purchases and change in inventory 1 122 1,042
Other purchases and external charges 773 744
Taxes and duties 92 83
Personnel costs 900 835
 Depreciation allocation 27 28
Provisions allocations 152 224
Total operating expenses 3,066 2,956
Operating result 373 379
Financial result -115 -124
Current result before tax 258 255
Exceptional result
Corporate tax 74 83
Net income 184 172

Annex

The appendix of the annual accounts specifies:

Acquisition costs of fixed assets are recognized as expenses;

The scheduled and decided maintenance expenses have been the subject of a
provision for major maintenance;
in the absence of signs of impairment, the elements of fixed assets
have not been subject to any depreciation;
The commitment regarding retirement severance pay has been evaluated.
for employees aged over 50 years at the closing date. Its amount
is of 11,787 €, charges included. This commitment is mentioned
in the appendix, without indication of the calculation assumptions.

Questions
I. Mandate of the auditor

The mandate of the statutory auditor was renewed during

the general assembly of April 26, 2013.

Work to do
1. What exercises are covered by this mandate?

The statutory auditor wishes to retire at the end of 2016.

2. When can the auditor terminate his

mandate?

The alternate auditor replaces the auditor

holder accounts.

3. What will be the exercises controlled by the auditor?

substitute?

4. What should he do when he takes over the case?

Can the alternate auditor refuse the replacement?
If so, for what reasons?

II. Mission Plan and Work Program

6. What analysis do you make of the financial situation of the hotel-restaurant?

At the Black Tulip?
7. What will be the impact of the conclusions of the financial analysis on the
how the mission unfolds?
8. What significant areas can be determined?
9. What criteria can be retained by the auditor?
to determine the significance threshold to apply to the 2016 exercise?
10. What is the difference between the significance threshold and the threshold of
planning?
11. According to the hourly scale presented in Appendix 5, what is the number
What hours can you offer for this mission?
12. Control techniques to be used
For which accounts will it be relevant to use the request for
third party confirmation?
Will it be relevant to use the inspection technique? If so, for
what controls?
13. Use of the accountant's work
Recall what a presentation mission is.
Can the accountant invoke professional secrecy and not
respond to the request of the auditor to consult his
work file?
Can the auditor exclude from his work program
the personal cycle due to the intervention of the accountant?
14. The roof needs to be redone. The SCI LAFRONDE is having difficulties obtaining
a bank loan. The auditor is requested to
give advice on the possibilities of taking care of this work
by the company.
What will be the response of the auditor?

III. Evaluation of internal control

15. The evaluation of internal control can be spread over several periods.
Propose a multi-year program.
16. What recommendations can be made by the commissioner to
accounts regarding the management of fixed assets?
17. Cash operations: are the procedures in place?
appropriate?

IV. Substance Controls

Items placed in deposit

In the lounge near the entrance of the hotel, Mr. FANFAN has agreed to exhibit
the works of painters from the region. These are on deposit and the hotel
receives a commission of 10% of the selling price.
18. What is the expected accounting treatment?
19. What will be the attitude of the auditor if another treatment
Is the accountant noted?
20. How can the auditor ensure the rights
of ownership of these canvases?

Depreciation of goodwill

21. What will be the duties of the statutory auditor?

Stock

Inventories do not represent an important item on the balance sheet. The auditor
the accounts wish to perform checks that, if satisfactory, do not
would not be renewed for the following exercise.
22. What diligences can he implement?

Annex

23. The information mentioned in the appendix regarding commitments

Are the retirement benefits satisfactory?

As collateral for the bank loans, Mr. Charles FANFAN had to provide
caution for the company.
24. What control can the statutory auditor perform?

Management declaration

25. At what stage of the mission should the management's declaration letter be?
requested?

26. Based on all the information you have at your disposal,

What information must the auditor find?
regarding the letter that will be addressed to him by Mr. Guillaume FANFAN?

V. End of mission, reports and specific verifications

27. Justification of assessments: what elements will be taken into account by

the auditor to draft this part of the general report?

28. The 2014 accounts were certified with reservations because the constitution of
the provision for major maintenance was not sufficiently justified and documented.
According to the information that will be obtained on the 2015 accounts, what
will the impact of this reserve on the certification of the 2014 financial statements.

29. The pastry purchases made from Mr. Charles FANFAN's brother
Should they be considered a regulated agreement?

Corrected

I. Mandate of the auditor

1. The mandate of the auditor covers the financial years 2013 to

2018.
2. The auditor, wishing to retire at the end of 2016,
will submit his resignation to the general assembly ruling on the accounts of
the 2015 exercise which must take place before June 30, 2016.
The deputy auditor replaces the auditor
holder.
3. The deputy auditor will review the fiscal years 2016 to
2018.
4. At the moment the auditor takes over the file, he must:
• s’assurer qu’il n’est pas dans une situation d’incompatibilité et
that he has the means to successfully carry out this mission;
• declare this new mandate to the regional company of which it
depends;
• Get in touch with the resigning auditor.
to have communication of the working file for the last closed fiscal year.
5. The alternate auditor cannot refuse this.
replacement if he is in a situation of incompatibility or in
the material impossibility of carrying out its mission.

II. Mission plan and work program

6. Analysis of the financial situation of the hotel-restaurant "At the Black Tulip"
»:

2015 2014
Self-financing capacity 273 394

Working capital 66 58
Working capital requirement -23 -54
Treasury + 89 + 112

Financial independence 629/977 = 0.64 445/1 132 = 0.39

 Depreciation rate of
280/477 = 59 %
immobilizations

Rotation clients 36 360/3 349 = 4 j 50 360/3 305 = 5.4 j

38 360/(1 122 + 773) = 82 360/(1 042 + 744) = 16
Supplier rotation 7j j

The self-financing capacity allows for meeting the repayments of

loans (€155k in 2015), but is not sufficient to cope with the
investments that are made mandatory by the safety commission and
veterinary services. It will not be possible to distribute dividends,
which risks deteriorating relations between shareholders.

The working capital is slightly positive and financial balance is ensured.

by the importance of operating debts (negative working capital). The cash flow is
positive, but this balance is very fragile.

Financial independence is improving: loan repayments and

profit result. The ability to take out new loans to do
facing mandatory investments is not guaranteed. The rate of obsolescence of
investments are not very high and the renewal needs of
immobilizations are not very important.

The turnover rates of customers and suppliers are not high and do not
do not represent significant action variables for society.

6. The fragility of the financial situation may lead the commissioner

to the accounts to trigger a warning procedure. He must hold on
informed of the evolution of this situation and particularly of the conditions
funding for mandatory work.

8. Significant areas:
• In relation to the balance:
– fixed assets represent about 90% of the total
balance. Intangible assets (goodwill) are
the most important assets;
– provisions are also an important element with the
equity. On the other hand, debts and receivables
The exploitation does not represent significant elements.
• Regarding the income statement: revenue, purchases
And personnel costs are the most important elements.

9. The significance threshold is determined based on the annual accounts.

2014; it may be reviewed based on the 2015 accounts.
To determine the significance threshold, one can retain as a criterion the
amount of equity, the profit, the turnover.
10. The threshold of significance is the amount beyond which anomalies
Significant (alone or combined) that could be detected must be
corrected.
The planning threshold is the amount below which controls do not apply.
will not be carried out, except in the case of procedure checks, to evaluate the
internal control.

11. The total balance + operating income + financial income amounts to

more than 5,959 k€ in 2014. The amount of financial products is not
known, but given the financial situation, they cannot be
very high, they are therefore neglected in this case. The range of hours
the corresponding duration is from 70 to 120 hours.
If the work of the chartered accountant can be used, it is possible to
propose a weekly volume of 80 to 90 hours.

12. Control techniques to use:

• Request for confirmation of third parties
Due to the importance of financial debts, a request for confirmation
third parties can be made to the banks.
It will not be appropriate to request confirmation for the
customer and supplier accounts, unless the accounts for the 2015 fiscal year are
to incur debts to fixed asset suppliers.

• Inspection technique

The summary note for the 2014 exercise indicates that the company did not do
of the physical inventory of fixed assets. It will be appropriate to make a
inspection of certain fixed assets.

13. Use of the accountant's work

The presentation mission is the mission that corresponds to the establishment of

annual accounts. It is specific to French regulations and does not
concerns only accountants.

This mission does not correspond to the adaptation of the planned missions by
the IFAC, which retained only the audit missions, limited review, and procedures
venues and compilation. It corresponds to a moderate level of assurance.
It concludes with an assessment of coherence and plausibility.
of accounts.

The accountant cannot invoke professional secrecy to refuse.

the auditor access to his working file. However, he
will not have to provide information other than that related to the closure
accounts.
The auditor cannot exclude from his work program
the personal cycle simply due to the intervention of an accountant.
He must first assess the work done and then determine the diligence.
supplements to be implemented.

14. The auditor cannot answer this question which

does not fall within the scope of its mission. It is contrary to the principle of non-
interference in management. He will only be able to provide information
general regulations regarding ground leases and
his conclusions on the analysis of the provisions set out in the lease
emphyteutic lease that was signed between the SCI and the company.

III. Evaluation of internal control

15. The assessment of internal control should prioritize management.

fixed assets, cash transactions, personnel management.
Given the risk of fraud, we should start with the operations in
species. Assuming the hypothesis of the good quality of the intervention of
The accountant, this personal cycle could be seen last.

16. The auditor must recommend the implementation of a

procedure for tracking assets that allows for quick
reconciliation between the asset file and the items present in
the hotel and the restaurant.
In this regard, he can inform Mr. FANFAN of the existence of specific software,
the possibility of affixing a label with the asset number
and the necessity to sufficiently detail the asset sheets that
should be validated by Guillaume FANFAN.

The existence of cash discrepancies shows that the procedures are not
satisfactory. The weaknesses of these procedures are:
• the absence of regular bank deposits of cash;
• the lack of expense tracking: difficulties in obtaining receipts
justifications for small expenses;
• Access to the restaurant and bar cash registers for all service staff.

IV. Substance Controls

Items placed in deposit

18. The stars do not belong to society. They should not be

recognized. Only the commission received will be recorded as revenue.
annexes.

19. If the canvases are accounted for as inventory or fixed assets, the
The auditor will need to request an adjustment. Regarding the asset
not belonging to them, this accounting could be similar to a
fraud, which should then be revealed.

20. Obtaining the existing agreement between the artists and the company.
will also be able to request confirmation from the artists.

Depreciation of goodwill

21. For the open exercises starting from January 1, 2016, for the funds
commercials whose usage duration is not limited, a test of
depreciation must be carried out at least once a year, as long as there are signs of
loss of value has been identified or not.
The auditor must verify that the impairment test has been properly conducted.
has been carried out and that the assumptions made are "sincere". It must also
to provide an assessment on the lack of depreciation of the commercial fund.
If necessary, he can call on an expert.

Stock

22. The auditor has several options:

• analytical procedure by type of products in stock;
• verification of a calculation, to ensure that there is no error of
totalization;
• control of the evaluation, to ensure that the unit prices retained
corresponding to the billed price.

Annex

23. The provision is calculated for all employees according to a

actuarial method. No information is provided in the appendix about the
calculation method and the assumptions made. This does not allow the reader
accounts to have a good understanding of the importance of this
engagement.
The information provided in the appendix is therefore incomplete and the commissioner for
accounts must request that it be completed.

24. As collateral for the bank loans, Mr. Charles FANFAN had to provide
caution for the company. The commitments received must be mentioned in
annex. The auditor must verify the existence of this
information.
To verify the accuracy of the conditions accepted by Mr. Charles FANFAN and
mentioned in the appendix, the auditor may have
communication of the loan contract established by the bank. It can also
request confirmation from the bank for these elements (request for
third-party confirmation.
Management Statement

25. The management statement must be obtained at the very end of the mission.
It must mention, in particular, the events occurring after the closing.
which should be included in the annex or in the management report.

26. The NEP 580 outlines the various points that must be addressed in
the statement from the management. In addition to these elements, Mr. Guillaume
FANFAN could provide details on:
• the assumptions retained to carry out the impairment test of the fund
commercial;
• the fact that the duration of use of the commercial fund is not limited;
• the absence of an indicator of impairment of the goodwill;
• compliance with safety regulations and rules
of hygiene;
• the insurance of buildings must be sufficient;
• the proper application of the collective agreement.

V. End of mission, reports and specific verifications

27. The justification of evaluations (NEP 705) focuses on points

determinants for the understanding of accounts and which requires more
particularly the implementation of professional judgment (choice of
accounting methods, estimates.
The selected elements will be: the evaluation of the business goodwill and the
provisions for risks and liabilities.

28. This is a reserve for disagreement. Several situations must be

envisaged:
• the justification and the documentation are still not satisfactory:
a new reserve must be formulated and it will be necessary to specify that a reserve
A similar nature was formulated for the previous exercise;
• the auditor obtained all the documents allowing him
to appreciate the existence and evaluation of the provision for major maintenance: it
will make an observation in his report.

29. If Mr. Charles FANFAN's brother is an administrator or shareholder

owning more than 10% of the voting rights, it will be a convention
regulated. However, transactions concluded under normal conditions
are not regulated agreements.