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[主观题]

You are the partner responsible for performing an engagement quality control review on the

audit of Snipe Co. You are currently reviewing the audit working papers and draft audit report on the financial statements of Snipe Co for the year ended 31 January 2012. The draft financial statements recognise revenue of $8·5 million, profit before tax of $1 million, and total assets of $175 million.

(a) During the year Snipe Co’s factory was extended by the self-construction of a new processing area, at a total cost of $5 million. Included in the costs capitalised are borrowing costs of $100,000, incurred during the six-month period of construction. A loan of $4 million carrying an interest rate of 5% was taken out in respect of the construction on 1 March 2011, when construction started. The new processing area was ready for use on 1 September 2011, and began to be used on 1 December 2011. Its estimated useful life is 15 years.

Required:

In respect of your file review of non-current assets:

Comment on the matters that should be considered, and the evidence you would expect to find regarding the new processing area. (8 marks)

(b) Snipe Co has in place a defined benefit pension plan for its employees. An actuarial valuation on 31 January 2012 indicated that the plan is in deficit by $10·5 million. The deficit is not recognised in the statement of financial position. An extract from the draft audit report is given below:

Auditor’s opinion

In our opinion, because of the significance of the matter discussed below, the financial statements do not give a true and fair view of the financial position of Snipe Co as at 31 January 2012, and of its financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards.

Explanation of adverse opinion in relation to pension

The financial statements do not include the company’s pension plan. This deliberate omission contravenes accepted accounting practice and means that the accounts are not properly prepared.

Required:

Critically appraise the extract from the proposed audit report of Snipe Co for the year ended 31 January 2012.

Note: you are NOT required to re-draft the extract of the audit report. (7 marks)

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发布时间：2021-04-20

更多“You are the partner responsible for performing an engagement quality control review on the”相关的问题

第1题

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B.As long as

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第2题

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第3题

Bill: Here, Cindy! I'd like you to meet my best partner, Daniel.（To Daniel This is Cindy,

Bill: Here, Cindy! I'd like you to meet my best partner, Daniel.(To Daniel This is Cindy, my girlfriend.Cindy: Hi, Daniel.______.Daniel: Mostly good things I hope.A.How do you do？ B.You look handsome.C.Bill tells me you're a good guy.D.Bill talks about you a lot.

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第4题

Andy: Here, Sheila! I’d like you to meet my best partner, Arthur. （ToArthur) This is S

Andy: Here, Sheila! I’d like you to meet my best partner, Arthur. (ToArthur) This is Sheila, my girlfriend.

Sheila: Hi, Arthur. _________________

Arthur: Mostly good things I hope.

A: How do you do？

B: Andy talks about you a lot.

C: Andy tells me you ’re a good guy.

D: You looks handsome.

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第5题

（b) As a newly-qualified Chartered Certified Accountant in Boleyn & Co, you have been

(b) As a newly-qualified Chartered Certified Accountant in Boleyn & Co, you have been assigned to assist the ethics

partner in developing ethical guidance for the firm. In particular, you have been asked to draft guidance on the

following frequently asked questions (‘FAQs’) that will be circulated to all staff through Boleyn & Co’s intranet:

(i) What Information Technology services can we offer to audit clients？ (5 marks)

Required:

For EACH of the three FAQs, explain the threats to objectivity that may arise and the safeguards that should

be available to manage them to an acceptable level.

NOTE: The mark allocation is shown against each of the three questions.

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第6题

（a) （i) Identify and explain FOUR financial statement assertions relevant to classes of tr

(a) (i) Identify and explain FOUR financial statement assertions relevant to classes of transactions and events for the year under audit; and

(ii) For each identified assertion, describe a substantive procedure relevant to the audit of REVENUE. (8 marks)

(b) Hawthorn Enterprises Co (Hawthorn) manufactures and distributes fashion clothing to retail stores. Its year end was 31 March 2015. You are the audit manager and the year-end audit is due to commence shortly. The following three matters have been brought to your attention.

(i) Supplier statement reconciliations

Hawthorn receives monthly statements from its main suppliers and although these have been retained, none have been reconciled to the payables ledger as at 31 March 2015. The engagement partner has asked the audit senior to recommend the procedures to be performed on supplier statements. (3 marks)

(ii) Bank reconciliation

During last year’s audit of Hawthorn’s bank and cash, significant cut off errors were discovered with a number of post year-end cheques being processed prior to the year end to reduce payables. The finance director has assured the audit engagement partner that this error has not occurred again this year and that the bank reconciliation has been carefully prepared. The audit engagement partner has asked that the bank reconciliation is comprehensively audited. (4 marks)

(iii) Receivables

Hawthorn’s receivables ledger has increased considerably during the year, and the year-end balance is $2·3 million compared to $1·4 million last year. The finance director of Hawthorn has requested that a receivables circularisation is not carried out as a number of their customers complained last year about the inconvenience involved in responding. The engagement partner has agreed to this request, and tasked you with identifying alternative procedures to confirm the existence and valuation of receivables. (5 marks)

Required:

Describe substantive procedures you would perform. to obtain sufficient and appropriate audit evidence in relation to the above three matters.

Note: The mark allocation is shown against each of the three matters above.

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第7题

（a) State the FIVE threats contained within ACCA’s Code of Ethics and Conduct and for each

(a) State the FIVE threats contained within ACCA’s Code of Ethics and Conduct and for each threat list ONE example of a circumstance that may create the threat. (5 marks)

(b) You are the audit manager of Jones & Co and you are planning the audit of LV Fones Co, which has been an audit client for four years and specialises in manufacturing luxury mobile phones.

During the planning stage of the audit you have obtained the following information. The employees of LV Fones Co are entitled to purchase mobile phones at a discount of 10%. The audit team has in previous years been offered the same level of staff discount.

During the year the fi nancial controller of LV Fones was ill and hence unable to work. The company had no spare staff able to fulfi l the role and hence a qualifi ed audit senior of Jones & Co was seconded to the client for three months. The audit partner has recommended that the audit senior work on the audit as he has good knowledge of the client. The fee income derived from LV Fones was boosted by this engagement and along with the audit and tax fee, now accounts for 16% of the fi rm’s total fees.

From a review of the correspondence fi les you note that the partner and the fi nance director have known each other socially for many years and in fact went on holiday together last summer with their families. As a result of this friendship the partner has not yet spoken to the client about the fee for last year’s audit, 20% of which is still outstanding.

Required:

(i) Explain the ethical threats which may affect the independence of Jones & Co’s audit of LV Fones Co; and (5 marks)

(ii) For each threat explain how it might be avoided. (5 marks)

(c) Describe the steps an audit fi rm should perform. prior to accepting a new audit engagement. (5 marks)

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第8题

The following scenario relates to questions 1–5You are an audit manager at Horti & Co

The following scenario relates to questions 1–5You are an audit manager at Horti & Co

The following scenario relates to questions 1–5

You are an audit manager at Horti & Co and you are considering a number of ethical issues which have arisen on some of the firm’s long-standing audit clients.

Tree Co Horti & Co is planning its external audit of Tree Co. Yesterday, the audit engagement partner, Charlie Thrower, discovered that a significant fee for information security services, which were provided to Tree Co by Horti & Co, is overdue. Charlie hopes to be able to resolve the dispute amicably and has confirmed that he will discuss the matter with the finance director,

Percy Marsh, at the weekend, as they are both attending a party to celebrate the engagement of Charlie’s daughter and Percy’s son. Bush Co

Horti & Co is the external auditor of Bush Co and also provides other non-audit services to the company. While performing the audit for the year ended 31 October 20X8, the audit engagement partner was taken ill and took an indefinite leave of absence from the firm. The ethics partner has identified the following potential replacements and is keen that independence is maintained to the highest level:

Brian Smith who is also the partner in charge of the tax services provided to Bush Co

Monty Nod who was the audit engagement partner for the ten years ended 31 October 20X7

Cassie Dixon who introduced Bush Co as a client when she joined the firm as an audit partner five years ago

Pete Russo who is also the partner in charge of the payroll services provided to Bush Co

Plant Co

Plant Co is a large private company, with a financial year to 30 June, and has been an audit client of Horti & Co for several years. Alan Marshlow, a partner of Horti & Co, has acted as the engagement quality control reviewer (EQCR) on the last two

audits to the year ended 30 June 20X8. At a recent meeting, he advised that he can no longer be EQCR on the engagement as he is considering accepting appointment as a non-executive director and will sit on the audit committee of Plant Co.

The board of directors has also asked Horti & Co if they would be able to provide internal audit services to the company.

Weed Co

Weed Co, a listed company, is one of Horti & Co’s largest clients. Last year the fee for audit and other services was $1·2m and this year it is expected to be $1·3m which represents 16·6% and 18·1% of Horti & Co’s total income respectively.

3. Which of the following correctly identifies the threats to Horti & Co’s independence and proposes an appropriate course of action for the firm if Alan Marshlow accepts appointment as a non-executive director of Plant Co？

Threats Course of action

A.Self-interest and familiarity Can continue with appropriate safeguards

B.Self-interest and self-review Must resign as auditor

C.Self-review and familiarity Must resign as auditor

D.Familiarity only Can continue with appropriate safeguards

4. You are separately considering Plant Co’s request to provide internal audit services and the remit of these services if they are accepted.

Which of the following would result in Horti & Co assuming a management responsibility in relation to the internal audit services？

(1) Taking responsibility for designing and maintaining internal control systems

(2) Determining which recommendations should take priority and be implemented

(3) Determining the reliance which can be placed on the work of internal audit for the external audit

(4) Setting the scope of the internal audit work to be carried out

A.1 and 3

B.2, 3 and 4

C.1, 2 and 4

D.3 and 4 only

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第9题

It is important for us to know how to stay safe while traveling in foreign countries.

We’ve all heard the stories of travelers having their wallets(钱包) stolen or finding themselves in the wrong part of the town. So you have to be more careful than usual, when traveling abroad.

Remember to carry a small amount of cash and a copy of your ID with you at all times. There is no need to bring large amounts of cash with you. When shopping, use your credit card instead. Keep your wallet in your front pocket so that there is no way someone's hand could get in there without your noticing it.

Travel with a friend, business partner if possible. It is always better to travel in pairs than to go alone. Know where you’re going. Look at the map before you leave the hotel so that you know where you are going and how to get there.

Lock your valuables (贵重物品) either in the safe in your hotel room or in the main hotel safe.

Be aware of your surroundings. Look around when walking, and avoid keeping your head low.

B-26. When shopping abroad, you are advised to _____.

A、use online services

B、use a credit card

C、pay by check

D、pay in cash

B-27. To keep your wallet safe, you’d better _____.

A、hold it in your keep it in your hand

B、leave it in the hotel safe

C、put it in your front pocket

D、keep it in your shoulder bag

B-28. To know where you are going, you are advised to _____.

A、ask the police for detailed information

B、look at the map before leaving the hotel

C、always travel with your business partner

D、have a smart phone with you while traveling

B-29. Where should you keep your valuables while staying in a hotel？

A、In the hotel safe.

B、In your pockets.

C、In your traveling bag.

D、In a bedside containe.

B-30. Which of the following can be the title for the passage？

A、How to Ask Ways While Traveling.

B、How to Shop in a Foreign Country.

C、Protect Your Personal Information.

D、Stay safe While Traveling Abroad.

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第10题

You are a manager at Chennai & Co, a firm of Chartered Certified Accountants. One of t

he partners has asked you to investigate and respond to a number of issues which have arisen with two different companies.

(a) Delhi Co, a potential new client, is a privately owned and rapidly expanding company which currently operates below the audit threshold in the country in which it is based. The company’s management is currently considering having either a full audit or a limited assurance review of their financial statements. The partner would like you to assist the management of Delhi Co by writing a response to them in which you:

(i) Explain the difference between an audit of historical financial statements and a limited assurance review. (4 marks)

(ii) Discuss the relative advantages and disadvantages to Delhi Co of having an audit of their historical financial statements as opposed to a limited assurance review. (8 marks)

Delhi Co was incorporated in 2005, with founder and chief executive Mr Nimesh Dattani as the sole shareholder. After a period of rapid growth, Delhi Co took out a ten-year bank loan facility in June 2007 to finance Mr Dattani’s ambitious expansion plans. This was supported by a further injection of financial capital in 2014 through a new issue of shares in the company. The shares were sold to Mr Robert Hyland, an ex-business partner of Mr Dattani. The sale gave Mr Hyland a 40% shareholding in Delhi Co. He has no involvement in the management of the company.

Until recently Delhi Co operated with a small accounting department, comprising one full-time member of staff and one part-time employee. Due to the expansion of the company and Mr Dattani’s plans to expand the customer base internationally, it has been necessary to increase the size of the accounting function to include two new full-time members of staff. Both of the new recruits are part-qualified accountants and Mr Dattani has committed to sponsoring them through their remaining training and ACCA examinations.

Required:

Prepare the response to the management of Delhi Co as requested by the partner.

Note: The split of the mark allocation is shown against each of the issues above.

(b) The audit committee of another client, Mumbai Co, has asked the partner to consider whether it would be possible for the audit team to perform. a review of the company’s internal control system. A number of recent incidents have raised concerns amongst the management team that controls have deteriorated and that this has increased the risk of fraud, as well as inefficient commercial practices. The audit report for the audit of the financial statements of Mumbai Co for the year ended 31 March 2016 was signed a few weeks ago. Mumbai Co is a listed company.

Required:

In respect of the request for Chennai & Co to review Mumbai Co’s internal control systems: Identify and discuss the relevant ethical and professional issues raised, and recommend any actions necessary. (8 marks)

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第11题

Section A暂缺Section B – ALL SIX questions are compulsory and MUST be attemptedYou are an

Section A暂缺

Section B – ALL SIX questions are compulsory and MUST be attempted

You are an audit manager of Pink Partners & Co (Pink) and are planning the audit of Golden Finance Co (Golden), a banking institution which provides a range of financial services including loans. Your firm has audited Golden for four years and the company’s year end is 30 September 2015.

At the end of August, Golden’s financial controller left and the new replacement is not due to start until approximately two months after the year end. The finance director, who is the sister-in-law of the audit engagement partner, has asked if a member of the audit team can be seconded to Golden for three months to act as the temporary financial controller.

You are aware that a number of the audit team members currently bank with Golden and two team members have significant loans owing to the company.

Pink’s taxation department also provides services to Golden. They have been approached by Golden to represent them in negotiations to resolve some outstanding issues with the taxation authorities, for which the fees quoted are substantial.

The finance director has informed the audit engagement partner that when the audit is complete, she would like the whole team to attend an evening watching the national football team play a match followed by a luxury meal.

Required:

Using the information above:

(i) Identify and explain FIVE ethical threats which may affect the independence of Pink Partners & Co’s audit of Golden Finance Co; and

(ii) For each threat, explain how it might be reduced to an acceptable level.

Note: The total marks will be split equally between each part.

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