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preparing an audit plan for the audit of the entity’s financial statements.

Question # 00083832
Subject: Accounting
Due on: 08/21/2015
Posted On: 07/22/2015 01:00 AM

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Assignment info

Auditing Assignment

Company- ACUREX

Length: Maximum word limit 3000 words (including Appendices)

Required

1. For the purpose of the assignment, you assume the role of an auditor and your firm

has recently been appointed as external auditor of an entity. As required by Auditing

Standard ASA300, you are preparing an audit plan for the audit of the entity’s

financial statements.

2. The audit fee is $92,000 and had been communicated to the client in the

Engagement Letter.

3. You are required to download the 2011 annual report published by the following

entity:

ACRUX (www.acrux.com.au)

4. Using the first four steps in the audit process as prescribed in Chapter 6 (pages 254-

255) of the textbook, plan the audit for the entity you have chosen. Since you are

required to develop an audit plan for a real life entity, quoting directly from textbook

does not meet the objective of the assignment.

5. Your audit plan must include the followings:

1. Executive summary

2. Introduction

3. Audit plan with the following headings:

a. Understanding the entity and its environment

b. Understanding internal control

c. Assessing the risks of material misstatement (for 5 key accounts)

d. Developing responses to assessed risks (for the accounts selected above)

4. Conclusion

5. References

6. Appendice

Additional information

For the purposes of the assignment, the following auditing standards are relevant:

- ASA210 Terms of Audit Engagements

- ASA220 Quality Control for Audits of Historical Financial Information

- ASA230 Audit Documentation

- ASA250 Consideration of Laws and Regulations in an Audit of a Financial Report

- ASA300 Planning an Audit of a Financial Report

- ASA315 Understanding the Entity and its Environment and Assessing the Risks of

Material Misstatement

- ASA320 Materiality and Audit Adjustments

- ASA330 The Auditor’s Procedures in Response to Assessed Risks

- ASA520 Analytical Procedures

Hints

. You are required to plan the audit using only information that is publicly

available. That is, you only use the information that is published by the entity

either on its website or printed materials.

2. You must download and use the proforma audit plan on webct.

3. Information on the organisation’s internal control structure can be obtained by

looking at the relevant section in the annual report, materials published on the

entity website and comparing them to the Principles of Good Corporate

Governance and Best Practice Recommendations published by the ASX

Corporate Governance Council.

4. In assessing the risks of material misstatement, you are required to identify

five (5) account balances at risk of being materially misstated. You are

required to support your selection using the Audit Risk Model.

5. Turnitin report not exceeding 12 %

Tags audit statements financial plan preparing entitys audit plan entity report required risks published understanding using financial aeing information materialmitatement asa300 relevant control download internal materials risk auditing textbook materiality terms asa320 mitatement engagements analytical asa520 auditadjustments

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preparing an audit plan for the audit of the entity’s financial statements.

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Tutorial Preview …process xx prescribed xx Chapter 6 xxxxxx 254- 255) xx the xxxxxxxxx xxxx the xxxxx for the xxxxxx you have xxxxxx Since xxx xxx required xx develop an xxxxx plan for x real xxxx xxxxxxx quoting xxxxxxxx from textbook xxxx not meet xxx objective xx xxx assignment x Your audit xxxx must include xxx followings: x xxxxxxxxx summary x Introduction 3 xxxxx plan with xxx following xxxxxxxxx x Understanding xxx entity and xxx environment b xxxxxxxxxxxxx internal xxxxxxx x Assessing xxx risks of xxxxxxxx misstatement (for x key…
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Preview: act xxxxxx in xxxxxxxxxxxx the interests xx the investors xxx invests xx xxx stocks xx the company xxxxxx going public xx is xxxxxxxxx xxx the xxxxxxx needs to xxxxxxx the external xxxxxxxx test xxxxxxx xx as xx assure that xxx financial statements xx reports xxxxxxxxx xx the xxxxxxx are true xxx correct The xxxxxxxxx reporting xxxxx xx be xx the accordance xx AASB / xxxx or xxxx xxx should xxxxxxx the ASA xxx and standards xxxxxxxxx risks xx xxxxxxxx misstatement:The xxxx of material xxxxxxxxxxxx of the xxxxxxxxx statements xx x fundamental xxxxxxxxxxxx to audit xxxxxxxx  Materiality refers to x difference xxxx xxxxx cause x decision maker xx change his xx her xxxxxxxx xxxxxxxx assess xxxxxxx a misstatement xx an amount xx disclosure xx xxxxxxxx based xx whether it xxxxx influence the xxxxxxxx decisions xx xxxxx with xxxxxxx qualifications These xxxxxxxxxxxxxx are:Having an xxxxxxxxxxx knowledge xx xxxxxxxx and xxxxxxxx activities and xxxxxxxxxx and a xxxxxxxxxxx to xxxxx xxx information xx the financial xxxxxxxxxx with an xxxxxxxxxxx diligence xxxxxxxxxxxxx xxxx financial xxxxxxxxxx are prepared xxx audited to xxxxxx of xxxxxxxxxxx xxxxxxxxxxx the xxxxxxxxxxxxx inherent in xxx measurement of xxxxxxx based xx xxx use xx estimates, judgment, xxx the consideration xx future xxxxxx xxxxxx appropriate xxxxxxxx decisions on xxx basis of xxxxxxxxxxx in xxx xxxxxxxxx statements xxxxxx AU 312 xxxxxxxxxxxxxx is not xxxxxxxxxx solely xx xxx basis xx quantitative factors xxx is influenced xx qualitative xxxxxxxxxxxxxxx xx well xxx example, fraud xxxxxxxxx by management xx always xxxxxxxxxx xxxxxxxx In xxxxxxxxx any uncertainties xxxxx transactions with xxxxxxx parties xxx xx considered xxxxxxxx because the xxxxxxxxxx evidence might xx less xxxxxxxx xx a xxxxxx of the xxxxxxxxxxxx Revenue:Revenue and xxx related xxxxxxxxxxx xxxxxxx should xx presumed to xx high risk xxx most xxxxxx xxxxxxx these xxxxxxxx are highly xxxxxxxxxxx to misstatement xxx auditor xxxxx xx understand xxx relationships present xx the accounts xxx how xx xxxx approach xx integrated audit xx the related xxxxxxxx and xxxxxxxx xxxxxxxxx statements xxx made up xx accounts, such xx revenue xx xxxxxxxx receivable xxxx represent a xxxxxxx of the xxxxxxxxxxxxxxxx transactions xxxxxxx xxxxxxxxxxxx that xxx linked by xxxxxxxxxx and controls xxx often xxxxxxx xxxxxxxx for xxxxxxxx and are xxxxxxxx to as x cycle xx xxxxxxx  The xxxxxxx earns revenue xxxx different sources xxx company xxxxxxxxxx xx interest xxxxxxx on the xxxxxxxxxxxx basis on xxx basis xx xxx interest xxxx that is xxxxxxxxxx of the xxxxxxxxx asset x xxxxx the xxxxxxxx is earned xxx company also xxxxx revenue xxxx xxx sale xx the product xx a particular xxxxx The xxxxxxx xxxxxxxxxx the xxxxxxx when the xxxxxxx is completes xxx sales xx xxx event xxxxxxx to the xxxxxxxxxx product The xxxxx is xxxxxxxxxx xx the xxxxxx when the xxxxx of a xxxxxxxxxx product xx xxxxxxxx The xxxxxxx has recognized xxxxxxx from diff.....
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