Petsupply Co has been a client for three years Your firm will already possess good business understanding, which will reduce the risk associated with the engagement, and should also cut down on planning time.
Irrelevant waffle earns no marks and will detract from the professional skills evaluation. Consider whether additional disclosures are required in the financial statements.
Scientec refused to purchase the new analysis machine due to its high cost and decided to purchase a second hand analysis machine which is much cheaper. But, the firm should not put the fact that it wants more revenue from providing assurance services above the more important consideration of ethical and professional issues, and the overall assessment of the risk attached to the assignment.
Table 1: Style of writing — the report is addressed to the partner and so language should be appropriate. The auditor is also warning that there were limited audit procedures that could be used by using negative assurance.
- The previous article stressed the importance of thinking through the scenario.
- The engagement partner for Farish and Associates have asked you to provide a negative assurance report on this forecast and issue an unqualified opinion with an emphasis of matter paragraph due to its going concern problem.
- When evaluating this particular scenario try to think widely about the information provided.
Why does Farish and Associates issue an Unqualified Opinion with an emphasis of matter paragraph for Scientec? A senior employee then left Scientec, stating lack of investment in new analysis machines was increasing the risk of incorrect information being provided by the company.
Stage 1 — understanding the requirement The first thing to do is to read and fully understand the question requirement. It is important to appreciate that few marks will be available for stating the issue.
Remember, when answering any question requirement it is quality not quantity that counts. As discussed in the previous article, these marks are not for the technical content of the answer, but for the way the relevant points are communicated.
Case Studies | The Center for Audit Quality
Not only did this provide adverse publicity for Scientec, but a number of clients withdrew their contracts. What follows is an outline report format for this requirement: Briefly explain four 4 audit procedures that may be carried out to try to determine whether or not Scientec is a going concern.
Answer Case 1 (case study 1) - Download as Word Doc .doc /.docx), PDF File . pdf), Text File .txt) or read online. aud and timesheets. Case Study – Audit – Supporting Documents adjustment? • PAST: Dispute the audit report by providing more evidence.
I am keen to hear your views on this matter at your earliest convenience. Having read the requirement, break it down.
- Answer Case 1 (case study 1) | Going Concern | Auditor's Report
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Here is the requirement we will be looking at in this article: By using the negative assurance. All of the above points suggest that the engagement will involve testing some subjective issues, and possibly relying on the controls put in place by the client, both of which have an impact on the overall risk assessment of the work requested.
The requirement is to evaluate the scenario and therefore it is crucial to demonstrate an appreciation that there may be two conflicting sides to the discussion.
When you receive the written reply from the previous auditors, you note that they have nothing to report other than any matters addressed in their audit report. unchanged resulting in [ ] and [ ] undertaking subsidiary audits reporting to [ ] For this case study, we did not interview the former CFO and former ACC who.
Now read the following extract from the scenario and highlight the salient points — remember to look out for any factors relevant to the ethical, professional, and other issues described above. Explain the four 4 audit procedures the auditor may take where the auditor has decided that Scientec is unlikely to be a going concern.