Top PDF ACCA Paper F8 Auditiing and Assurance F8AA(Int)DSGuide d08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)DSGuide d08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)DSGuide d08

30 The auditor’s report on financial statements This fundamentally important topic is deemed knowledge at Paper P7. In auditing terms, this is perhaps the most “technical” topic in the syllabus. If you do not understand any of the justifications to the audit opinions in the question bank answers, make a note to discuss it with your tutor on the revision course. After studying this session you should be able to: ¾ describe and analyse the format and content

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ACCA Paper F8 Auditiing and Assurance F8AA(INT)MT1A Qs j08

ACCA Paper F8 Auditiing and Assurance F8AA(INT)MT1A Qs j08

A variety of discounts are offered to customers depending on the type of customer (eg conference, business or private) and the time of week or year. The management has sought to increase the room occupancy of the hotel in recent years by offering weekend discounts to tourists.

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ACCA Paper F8 Auditiing and Assurance F8AA(Int)Mock1 Qs j08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)Mock1 Qs j08

“We planned and performed our audit so as to obtain as much information and explanation as possible given the time available for the audit. We confirm that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. The directors however are wholly responsible for the accuracy of the financial statements and no liability for errors can be accepted by the auditor. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the company’s annual report.”
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ACCA Paper F8 Auditiing and Assurance F8AA(Int)MT1A As j08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)MT1A As j08

The evidence is not conclusive since the grid could be initialled without the check being performed. The auditor is more likely to rely on the checks having been performed if there is other evidence (eg quantities cross-referenced to goods received notes and “cast” symbols). If it is established that the check, though evidenced, is not being performed (eg if reperformance identifies an error not detected by the client) no reliance should be placed on it (unless isolation can be proven).

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ACCA Paper F8 Auditiing and Assurance F8AA(Int)MT2A As j08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)MT2A As j08

„ The duties of internal auditors are generally determined by the organisation that has set up the internal audit department and employs the internal auditors. Internal auditors normally have a general responsibility to perform their work and their reviews of systems with the possibility of fraud and error in mind.

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ACCA Paper F8 Auditiing and Assurance F8AA(INT)MT2A Qs j08

ACCA Paper F8 Auditiing and Assurance F8AA(INT)MT2A Qs j08

1 There are similarities and differences between the responsibilities of internal and external auditors. Both internal and external auditors have responsibilities relating to the prevention, detection and reporting of fraud, for example, but their responsibilities are not the same. Both internal and external audit are part of an organisation’s overall corporate governance arrangements. Sometimes, the responsibilities of internal auditors are out-sourced to external organisations.

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ACCA Paper F8 Auditiing and Assurance F8AA(Int)RQB Qs d08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)RQB Qs d08

Explain the courses of action open to you in these circumstances. (10 marks) (b) You are the external auditor of the company in financial difficulties described in (a) above. You have noted that the calculations of the bad debt and depreciation provisions have been altered in the current year and that as a result, the bank’s requirements have been met. You also note that certain accounting policy changes have been made in relation to accounting for leases and that as a result, the profit targets expected by certain investment analysts have now been met. If the changes had not been made, the targets would not have been met. You have asked to speak to the internal auditor but you have been told that he is on long-term sick leave. The chief financial accountant is away on holiday and will not be back until shortly before the audit is due to be completed.
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ACCA Paper F8 Auditiing and Assurance F8AA(Int)RQB Conts d08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)RQB Conts d08

All rights reserved. No part of this training material may be translated, reprinted or reproduced or utilised in any form either in whole or in part or by any electronic, mechanical or other means, now known or hereafter invented, including photocopying and recording, or in any information storage and retrieval system, without permission in writing from the Accountancy Tuition Centre (International Holdings) Limited.

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ACCA Paper F8 Auditiing and Assurance  F8AA(Int)Mock1 As j08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)Mock1 As j08

„ Charities can be viewed as inherently risky because they are often managed by non- professionals and are highly susceptible to fraud (because of the high levels of cash), although many charities and the volunteers that run them are people of the highest integrity who take a great deal of care over their work.

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ACCA Paper F8 Auditiing and Assurance F8AA(Int)SOverview d08

ACCA Paper F8 Auditiing and Assurance F8AA(Int)SOverview d08

AUDIT AND ASSURANCE F8 – STUDY OVERVIEW 1 Stage of study System Study Sessions Syllabus coverage INTRODUCTORY Note: All topics to be covered before taking Monitoring Test 1 1 [r]

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ACCA Paper F8 Auditiing and Assurance F8AA SQB Qs j08

ACCA Paper F8 Auditiing and Assurance F8AA SQB Qs j08

You have been presented with the following draft financial information about Hivex, a very successful company that develops and licences specialist computer software and hardware. Its non-current assets mainly consist of property, computer hardware and investments, and there have been additions to these during the year. The company is experiencing increasing competition from rival companies, most of which specialise in hardware or software, but not both. There is pressure to advertise and to cut prices. You are the audit manager. You are planning the audit and are conducting a preliminary analytical review and associated risk analysis for this client for the year ended 31 May 2006. You have been provided with a summarised draft statement of comprehensive income which has been produced very quickly and certain accounting ratios and percentages. You have been informed that the company accounts for research and development costs in accordance with IAS 38 Intangible Assets.
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ACCA Paper F8 Auditiing and Assurance F8AA SQB As j08

ACCA Paper F8 Auditiing and Assurance F8AA SQB As j08

The existence of an internal audit department will improve controls in the company. Firstly, this is because of the “policing” effect, in that the existence of an internal audit department will make employees aware there is an increased risk the internal auditors will detect fraud or errors in their work. Thus employees will be more careful to minimise and correct any errors and they will be deterred from perpetrating a fraud. In addition, the internal auditors should improve the effectiveness and extent of controls as a result of the tests they carry out and the recommendations they make. Thus, the existence of an internal audit department reduces control risk. So, with an internal audit department, the external auditor should be able to carry out fewer tests of controls and/or substantive procedures in order to achieve the planned level of audit risk.
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ACCA Paper F8 Auditiing and Assurance F8AA SQB Conts j08

ACCA Paper F8 Auditiing and Assurance F8AA SQB Conts j08

„ Events after the balance sheet date ⇒ Events after the reporting period (IAS 10 is renamed) The Statement of Comprehensive Income basically consists of two elements – an income statement (the same as the old IAS 1 format) plus other comprehensive income comprising, for example, gains on revaluations, cash-flow hedges, translation of foreign operations and actuarial gains (all of which are still analysed within a statement of changes in equity).

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ACCA Paper F8 Auditiing and Assurance F8AA(IntRQB As d08

ACCA Paper F8 Auditiing and Assurance F8AA(IntRQB As d08

The Chairman’s statement would appear to represent a material inconsistency with the audited financial statements in accordance with ISA 720 Other Information in Documents Containing Audited Financial Information. It suggests that operating profit represents the true level of performance. IAS 1 Presentation of Financial Statements, however, requires items such as reorganisation costs and profits or losses on disposal of property, plant and equipment to be included in arriving at a measure of profit from ordinary activities for the period (also IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors). Reddy and Co should advise the Chairman to amend the information in his statement to avoid the apparent inconsistency. If the Chairman refuses Reddy and Co should consider taking appropriate action. One possibility is the inclusion of an emphasis of matter paragraph immediately after the unqualified opinion paragraph in the auditor’s report. If the matter were considered to be more serious Reddy and Co could refuse to issue the auditor’s report or withdraw from the engagement subject to receiving appropriate legal advice.
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ACCA Paper F 7 Financial Reporting F7FR(Int)SOverview d08

ACCA Paper F 7 Financial Reporting F7FR(Int)SOverview d08

FINANCIAL REPORTING F7 – STUDY OVERVIEW 1 Module System Study Session Subjects to be covered INTRODUCTORY PHASE 20 21 Group accounts – Basic principles: – Consolidated state[r]

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ACCA Paper F 7 Financial Reporting F7FR(Int) Mock1 d08 As

ACCA Paper F 7 Financial Reporting F7FR(Int) Mock1 d08 As

As Telenorth still bears the risk of slow payment and bad debts, the substance of the factoring is that of a loan on which finance charges will be made. The amount receivable from the customer should not have been derecognised (removed from the statement of financial position) nor should all of the difference between the amount due from the customer and the amount received from the factor have been treated as an administration cost. The required adjustments can be summarised as follows:

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Audit and Assurance INT F8 2019

Audit and Assurance INT F8 2019

This additional time is allowed at the beginning of each three-hour examination to allow candidates to read the questions and to begin planning their answers before they start writing in their answer books. This time should be used to ensure that all the information and exam requirements are properly read and understood.

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ACCA Noter Answer Paper F8 acca f8 int aa final assessment questions june09

ACCA Noter Answer Paper F8 acca f8 int aa final assessment questions june09

Richard Pine is a senior audit manager for Ratcliffe, Barnes and Soames, a firm with several offices around two large towns in different parts of the country. These split locations have arisen from the merger two years previously of Barnes & Soames, a firm specialising in the audit of property and service companies, with Ratcliffe, whose fee income was based on the audit of farms and holiday resorts. The merger was seen as an opportunity for both firms to break away from their restricted markets.

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ACCA Paper F 7 Financial Reporting F7FR(Int) Mock1 d08 Qs

ACCA Paper F 7 Financial Reporting F7FR(Int) Mock1 d08 Qs

(i) An inventory count was not conducted by Telenorth until 4 October 2008 due to operational reasons. The value of the inventory on the premises at this date was $16 million at cost. Between the year-end and the inventory count the following transactions have been identified:

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ACCA Paper F 7 Financial Reporting F7FR(Int) MT1B As d08

ACCA Paper F 7 Financial Reporting F7FR(Int) MT1B As d08

Which is approximately equal to $2·4 million, the fair value of the asset. The profit or loss will show depreciation as an operating expense. The asset will be depreciated over six years, which is both the lease term and the useful economic life of the asset. Therefore (assuming a straight line basis of deprecation) the annual depreciation will be $400,000. The profit or loss will also show a finance cost of $240,000, being the “interest” on the effective borrowing of $2·4 million at 10%.

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