HI6026 - Audit, Assurance and Compliance - The Auditor's Professional, Legal and Ethical - Accounting Assignment Help

Assignment Task    
 

Purpose: This assignment is designed to assess your level of knowledge of the key topics covered in this unit

Unit Learning Outcomes Assessed.:

1. Demonstrate an understanding of the reporting requirements and auditing standards.
2. Demonstrate an understanding of the auditor's professional, legal and ethical responsibilities to their clients and third parties.
3. Identify the elements of the financial report audit process.
4. Understand the audit planning procedures, evaluate the business risk and assess the internal control.
5. Prepare auditing procedures for transactions and balances by conducting control and substantive Tests.
6. Understand the auditor's reporting obligations.

Description: Each week students were provided with three tutorial questions of varying degrees of difficulty. The tutorial questions are available in the Tutorial Folder, for each week, on Blackboard. The Interactive Tutorials are designed to assist students with the process, skills and knowledge to answer the provided tutorial questions. Your task is to answer a selection of tutorial question for weeks 1 to 5 inclusive and submit these answers in a single document.

Submission Directions:

The assignment will be submitted via Blackboard. Each student will be permitted only ONE submission to Blackboard. You need to ensure that the document submitted is the correct one.

Question 1 -

You have recently graduated from your university course and start work with an audit firm. You meet an old school friend, Nayan, for dinner — you haven't seen each other for several years. Nayan is surprised that you are now working as an auditor because your childhood dream was to be a ballet dancer. Unfortunately, your knees were damaged in a fall, and you can no longer dance. The conversation turns to your work, and Nayan wants to know how you do your job. Nayan cannot understand why an audit is not a guarantee the company will succeed. Nayan also thinks that company managers will lie to you in order to protect themselves. As an auditor, you would have to assume that you cannot believe anything a company manager says to you.

Required:

(a) Write a letter to Nayan explaining the concept of reasonable assurance, and how reasonable assurance is determined. Explain why an auditor cannot offer absolute assurance
(b) Explain in the letter to Nayan the concept of 'professional scepticism' and how it is not the same as assuming that managers are always trying to deceive auditors 

Question 2 - 

Liona is the managing partner of Ross and Associates, a small audit firm. Liona's role includes managing the business affairs of the firm, and she is very worried about the amount of fees outstanding from audit clients. Broomers Pty Ltd, one of the client of Ross and Associates, has not paid its audit fees for two years despite numerous discussions between Liona, their audit partner Ball, and the management of Broomers Pty Ltd. Broomers Pty Ltd's management has promised the fees would have been paid before the audit report for this year has been published, Liona rang Ball this morning to ensure that the audit report was not issued because Broomers Pty Ltd had paid only 10 per cent of the outstanding account. She discovers that Ball is about to sign the audit report.

Required:
(a) Explain the ethical problem in this case. Why is it a problem?. 
(b) What can be done about it? (3 marks) (50 – 100 words)

Question 3 - 

One of the clients of MMM Chartered Accountants operates a restaurant. From January ofthe current year, the business has consistently paid its suppliers late, well in excess of thesuppliers' normal credit terms. This has resulted in some suppliers requesting cash on deliveryfrom the business. The auditor has reviewed the correspondence between the business andits bank and finds that the business has been experiencing cash flow problems for two years.

Required:

(a) Explain why determination of materiality is a matter of auditor judgment. Refer toboth qualitative and quantitative materiality assessments 
(b) Explain whether (and, if so, how) the information provided impacts on the auditor's assessment of preliminary materiality 

Question 4 - 

(a) What are the auditor's responsibilities for 'going concern assumptions’'? 

(b) Maxim Stewart is the partner in charge of the audit for a new client, Southern Southerland (SS). The client engaged Maxim's audit firm in November 2017, in preparation for the 2018 audit. From 30 January 2018 onwards, SS has consistently paid its suppliers late, well in excess of the suppliers' agreed credit terms. This has resulted in some suppliers demanding cash on delivery from SS. Maxim is also aware from his review of correspondence between SS and its bank that the company has been experiencing cash flow problems since 2016. Required: Identify any significant events or conditions that individually or collectively may cast significant doubt on SS's ability to continue as a going concern .

Question 5- 

Jonas Worth is the engagement partner for the financial report audit of Caufield Ltd for theyear ended 31 December, 20X7. The following material events or transactions have come to Wood's attention before he is scheduled toissue his report on 28 February, 20X8.
a) On 3 January, 20X8, Caufield Ltd received a shipment of raw materials from korea. Thematerials had been ordered in October 20X7, and shipped FOB shipping point inNovember 20X7 .
b) On 15 January, 20X8, the company settled and paid a personal injury claim of a formeremployee as the result of an accident that occurred in March 20X0. The company hadnot previously recorded a liability for the claim.
c) On 25 January, 20X8, the company agreed to purchase for cash the outstanding sharesof La Trobe Electrical Ltd. The acquisition is likely to double the sales volumof CaufieldLtd 
d) On 1 February, 20X8, a plant owned by Caufield Ltd was damaged by a flood, resultingin an uninsured loss of inventory 

Academic Integrity

Holmes Institute is committed to ensuring and upholding Academic Integrity, as Academic Integrity is integral to maintaining academic quality and the reputation of Holmes' graduates. Accordingly, all assessment tasks need to comply with academic integrity guidelines. Table 1 identifies the six categories of Academic Integrity breaches. If you have any questions about Academic Integrity issues related to your assessment tasks, please consult your lecturer or tutor for relevant referencing guidelines and support resources. Many of these resources can also be found through the Study Skills link on Blackboard.

Academic Integrity breaches are a serious offence punishable by penalties that may range from deduction of marks, failure of the assessment task or unit involved, suspension of course enrolment, or cancellation of course enrolment.

If any words or ideas used the assignment submission do not represent your original words or ideas, you must cite all relevant sources and make clear the extent to which such sources were used. In addition, written assignments that are similar or identical to those of another student is also a violation of the Holmes Institute's Academic Conduct and Integrity policy. The consequence for a violation of this policy can incur a range of penalties varying from a 50% penalty through suspension of enrolment. The penalty would be dependent on the extent of academic misconduct and your history of academic misconduct issues. All assessments will be automatically submitted to SelfAssign to assess their originality

If any words or ideas used the assignment submission do not represent your original words or ideas, you must cite all relevant sources and make clear the extent to which such sources were used.

In addition, written assignments that are similar or identical to those of another student is also a violation of the Holmes Institute's Academic Conduct and Integrity policy. The consequence for a violation of this policy can incur a range of penalties varying from a 50% penalty through suspension of enrolment. The penalty would be dependent on the extent of academic misconduct and your history of academic misconduct issues. All assessments will be automatically submitted to SelfAssign to assess their originality

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