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–Where is John? I couldn't find him. ()
A.He is very busy working on his project.
B.I am sorry but I 'm afraid I can 't agree with you.
C.I suppose he could have gone to the meeting room.
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C、I suppose he could have gone to the meeting room.
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A.He is very busy working on his project.
B.I am sorry but I 'm afraid I can 't agree with you.
C.I suppose he could have gone to the meeting room.
C、I suppose he could have gone to the meeting room.
(i) Contribution will be increased by $2 for each additional kg of material B purchased at the current market price
(ii) The maximum price which should be paid for an additional kg of material B is $2
(iii) Contribution will be increased by $1·20 for each additional kg of material B purchased at the current market price
(iv) The maximum price which should be paid for an additional kg of material B is $2·80
Which of the above statements is/are correct?
A.(ii) only
B.(ii) and (iii)
C.(i) only
D.(i) and (iv)
(a) I know that auditors are required to assess risks of material misstatement by developing an understanding of the business risks of an audit client, but I am not clear on the relationship between business risk and risk of material misstatement. Can you explain the two types of risk, and how identifying business risk relates to risk of material misstatement? (4 marks)
(b) I worked on the interim audit of Crow Co, a manufacturing company which outsources its payroll function. I know that for Crow Co payroll is material. How does the outsourcing of payroll affect our audit planning? (4 marks)
(c) Crow Co is tendering for an important contract to supply Hatfield Co. I know that Hatfield Co is also an audit client of our firm, and I have heard that Crow Co’s management has requested our firm to provide advice on the tender it is preparing. What matters should our firm consider in deciding whether to provide advice to Crow Co on the tender? (5 marks)
(d) I also worked on the audit of Campbell Co, where I heard the managing director, Ting Campbell, discussing a potential new business opportunity with the audit engagement partner. Campbell Co is an events organiser, and is planning to run a programme of nationwide events for accountants, at which speakers will discuss technical updates to financial reporting, tax and audit regulations. Ting proposed that our firm could invest some cash in the business opportunity, supply the speakers, market the events to our audit clients, and that any profit made would be shared between Ryder & Co and Campbell Co. What would be the implications of our firm considering this business opportunity? (7 marks)
Required:
For each of the issues raised, respond to the audit junior, explaining the ethical and professional matters arising from the audit junior’s comments.
Note: The split of the mark allocation is shown against each of the issues above.
(b) You are the audit manager of Jinack Co, a private limited liability company. You are currently reviewing two
matters that have been left for your attention on the audit working paper file for the year ended 30 September
2005:
(i) Jinack holds an extensive range of inventory and keeps perpetual inventory records. There was no full
physical inventory count at 30 September 2005 as a system of continuous stock checking is operated by
warehouse personnel under the supervision of an internal audit department.
A major systems failure in October 2005 caused the perpetual inventory records to be corrupted before the
year-end inventory position was determined. As data recovery procedures were found to be inadequate,
Jinack is reconstructing the year-end quantities through a physical count and ‘rollback’. The reconstruction
exercise is expected to be completed in January 2006. (6 marks)
Required:
Identify and comment on the implications of the above matters for the auditor’s report on the financial
statements of Jinack Co for the year ended 30 September 2005 and, where appropriate, the year ending
30 September 2006.
NOTE: The mark allocation is shown against each of the matters.
Kyanite Pizzas Co (Kyanite) operates a large chain of fast food restaurants. You are an audit supervisor of Jasper & Co and are currently preparing the audit programmes for the audit of Kyanite’s financial statements for the year ended 31 March 2016. You are reviewing the notes of last week’s meeting between the audit manager and finance director where two material issues were discussed.
(i) Property, plant and equipment
In the past Kyanite has received negative press reports over the condition of its fast food restaurants, with comments suggesting they are old fashioned and tired looking. Therefore during the year the company undertook a full review of all its assets and carried out extensive refurbishments to the majority of its restaurants. This review resulted in a significant amount of ageing fixtures and fittings being disposed of and a significant amount of capital expenditure was invested in all remaining restaurants. (6 marks)
(ii) Equity The refurbishment was financed via a share issue in April 2015 at a premium of $1·6 million. (4 marks)
Required:
Describe substantive procedures you should perform. to obtain sufficient and appropriate audit evidence in relation to the above two matters.
Note: The mark allocation is shown against each of the two matters above.
A.attack the sun as an unruly servant
B.give compliments to the mistress and her power of beauty
C.criticize the sun's intrusion into the lover's private life
D.lecture the sun on where true royalty and riches lie
(a) (i) Identify and explain FOUR financial statement assertions relevant to account balances at the year end; and
(ii) For each identified assertion, describe a substantive procedure relevant to the audit of year-end inventory. (8 marks)
(b) Pineapple Beach Hotel Co (Pineapple) operates a hotel providing accommodation, leisure facilities and restaurants. Its year end was 30 April 2012. You are the audit senior of Berry & Co and are currently preparing the audit programmes for the year end audit of Pineapple. You are reviewing the notes of last week’s meeting between the audit manager and finance director where two material issues were discussed.
Depreciation
Pineapple incurred significant capital expenditure during the year on updating the leisure facilities for the hotel. The finance director has proposed that the new leisure equipment should be depreciated over 10 years using the straight-line method.
Food poisoning
Pineapple’s directors received correspondence in March from a group of customers who attended a wedding at the hotel. They have alleged that they suffered severe food poisoning from food eaten at the hotel and are claiming substantial damages. Pineapple’s lawyers have received the claim and believe that the lawsuit against the company is unlikely to be successful.
Required:
Describe substantive procedures to obtain sufficient and appropriate audit evidence in relation to the above two issues.
Note: The total marks will be split equally between each issue. (8 marks)
(c) List and explain the purpose of FOUR items that should be included on every working paper prepared by the audit team. (4 marks)
I don't deny that John has kept me______as to his intentions, but I do not mind it.
A.in the open
B.in the dark
C.on the run
D.on the stroke
John:May I use your computer this afternoon,Susie?
Susie:Sure,but I have to finish typing my term paper today.
John:__________.
A.Do as you please
B.Oh,I"m sorry
C.Thank you just the same
D.Never mind it