Which of the following is considered a significant risk per ISA 315?

A significant risk, as defined by ISA 315, involves an increased likelihood of a material misstatement in the financial statements. Related party transactions are considered a significant risk primarily due to the inherent complexities and potential for manipulation these transactions can introduce. The nature of related parties can lead to conflicts of interest, subjective judgment, and non-standard terms compared to transactions with unrelated entities, making them more susceptible to risk.

Auditors must be particularly vigilant about related party transactions in their assessments because they may not be conducted at arm's length, potentially leading to transactions that do not reflect genuine market conditions. This complexity and the potential for misstatement necessitate deeper scrutiny and additional audit procedures, establishing them as significant risks within the context of audit planning.

Other types of transactions, such as routine transactions or simple accounting entries, generally carry a lower risk and are less likely to lead to material misstatements. Low-risk estimates also usually involve less complexity and subjectivity, further reducing their significance in terms of risk assessment during the audit.