flump 發問時間: 社會與文化語言 · 1 0 年前

Auditing - substantive testing

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The question is related to Auditing Accounts payable - substantive testing

You are the auditor of A Ltd and have been given the audit file to review.

The reporting date is 30 June 2007 and the materiality for the client has been set at $200,000.

You obtained the information listed below from your review of the audit file:

1. The balance noted accounts payable in the general ledger at 30 June is $158,000, which compares with a balance as at 30 June 2006 of $342,000.

2. The audit assistant noted in the file: "because the accounts payable balance is immaterial in the current year, only limited work is necessary.'

3. The only work performed by the audit assistant was to select the 3 largest payables from the client's detailed purchases ledger (which had been compared with the general ledger) and compare the balances with photocopies of supplier statements.

Required:

(a) Outline any queries you would raise with the audit assistant.

(b) Describe the additional audit procedures you believe should be performed to ensure that the accounts payable balance is fairly stated.

( from Modern Auditing & Assurance Services 3rd edition Proffessional application question 11.4)

Thanks for your effort

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  • 1 0 年前
    最佳解答

    (a) Outline any queries you would raise with the audit assistant.

    The account payable balance at 30 Jun 2007 is $158,000, a year-to-year decrease of 46% as compared to 30 Jun 2006 of $342,000.

    Why is there a 46% decrease of account payable? Any particular reason for this?

    (b) Describe the additional audit procedures you believe should be performed to ensure that the accounts payable balance is fairly stated.

    1. Agree the detailed accounts payable listing to the summary accounts payable listing.

    Obtain detailed accounts payable listing (aged by vendor, if possible) and perform the following:

    1a) Trace totals from the detailed accounts payable listing to the totals of the summary;

    1b) Select reconciling items in order to obtain a moderate to low level of assurance that accuracy is achieved.

    1c) Trace the selected reconciling items to supporting documentation;

    1d) Where there are significant reconciling items, determine whether the results of the investigations have been reviewed and approved by a responsible official.

    2. Test for unrecorded liabilities

    2a) Obtain a moderate to low level of assurance that completeness and cutoff are achieved for accounts payable by selecting all invoices above $xx and a sample of other invoice amounts from all accounts payable sources (i.e. the disbursement records, invoices received and recorded records, goods received not yet invoiced records and credits for returns) for the period after the balance sheet date up to the date of the completion of fieldwork.

    2b) By reference to supporting documentation, determine whether the item has been properly included as a liability or properly excluded.

    2c) For the 3 samples tested, verify the accounts payable balance against the original supplier statements.

    參考資料: Google
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