Auditor of Sunshine Ltd. is of the view that due to greater management intervention to specify accounting treatment, the risk of material…

(a) Risk of Material Misstatement Greater for Significant Non-Routine Transactions: Significant risks often relate to significant non- routine transactions or judgmental matters. Non-routine transactions are transactions that are unusual, due to either size or nature, and that therefore occur infrequently. Risks of Material Misstatement- Greater for Significant Non-Routine Transactions Risks of material misstatement may be greater for significant non-routine transactions arising from matters such as the following: (a) Greater management intervention to specify the accounting treatment. (b) Greater manual intervention for data collection and processing. (c) Complex calculations or accounting principles. (d) The nature of non-routine transactions, which may make it difficult for the entity to implement effective controls over the risks. Keeping in view above, view of Auditor of Sunshine Ltd. is correct.