October 7, 2012 at 7:35 pm
ayman85: youl offten find one disclosed in the notes
ayman85: this is 6 marks
sumreenkanwal: umm..its in the auditor’s interest to get a written representation on a mtter with insufficient audit evidence…as it will save them from litigation or something if anything goes wrong
mohammedalee: 3 valid points
mohammedalee: with discussion
mohammedalee: or may be 4, if too generous on p7 paper lol
mohammedalee: but auditors cant just go out and ask representation on everything and save their times!
ayman85: i would think that “Explain” is 2 marks per explination
sumreenkanwal: yes…thata right.
mohammedalee: and there arent much things out there abt which u cant even find a single evidence,
ayman85: what you guys are saying is correct
ayman85: when i went through the lsbf notes
ayman85: i read somewhere that
ayman85: when auditing subs
mohammedalee: yes, 3 points= with explanation
ayman85: its common practice to obtain a comfort letter from the parent’s board confirming intention to keep the sub alive
mohammedalee: i dont get it
mohammedalee: sub alive means?
mohammedalee: in the group?
mohammedalee: keep in the group?
ayman85: to give it a financial injection when it needs one
ayman85: for example if the sub was having going concern issues, the parrent would cover its back
mohammedalee: parental role of p3?
ayman85: give it moneys etc
mohammedalee: i get it
mohammedalee: parental developer
ayman85: i wouldnt mix it with that
ayman85: bcoz that relates to strategy
mohammedalee: im nt mixing
mohammedalee: im making sure what i understood is correct
mohammedalee: anywho, lets move
ayman85: just confirming that you will give you child food when he/she is hungry
mohammedalee: haha lol
omer321: which qs
ayman85: not let it starve to death
mohammedalee: question 1 pilot paper
mohammedalee: that would be awesome though
mohammedalee: part d now
ayman85: i have no idea about part d?
mohammedalee: its overlapping with part b
mohammedalee: lot of it
mohammedalee: like the things we discussed regarding increase of scope and all
omer321: can anybody upload the file
omer321: the paper i mean
mohammedalee: here it is
ayman85: is it not somthing to do with the group structure?
mohammedalee: part d is generalised
ayman85: what do they mean by horizontal group?
mohammedalee: it just means how new subsidiaries affect audit scope
mohammedalee: that D shaped group i guess
mohammedalee: parent has a sub
mohammedalee: sub has a sub
mohammedalee: and that stuff
ayman85: that wouldnt be a D shape
mohammedalee: and parent has direct interest in subsub
mohammedalee: nw its a D
ayman85: because it says non-consolidated entities under common control
omer321: on part D
mohammedalee: isnt that abt effective holding percentages?
sumreenkanwal: how is D horizontal then?
ayman85: when parent has a direct and indirect holding in the sub sub
mohammedalee: iguys, focus on horizontal group
sumreenkanwal: then it wud mean… just to have an interest..
mohammedalee: dont read the brackets!
sumreenkanwal: like investements
mohammedalee: he is trying to confuse us
mohammedalee: i swear
ayman85: im confused
omer321: what is common control
ayman85: i think he means investments
mohammedalee: im nt
mohammedalee: group means group
mohammedalee: investments dont come under groups
mohammedalee: group fs= consoldatied fs
mohammedalee: that is what i knw
mohammedalee: i might be wrong
delusion: no ur right
ayman85: so whats the answer?
omer321: common control like some joint venture
delusion: yes jv or jointly controlled asset operations
mohammedalee: or yop may be
ayman85: but those are not consolidated right
mohammedalee: lets focus on scope thing
delusion: equity accounting
delusion: as per revised standard
mohammedalee: we might have to see if they are going to be consolidated vs equity accounted
omer321: material matters to be considered of the sub
ayman85: so u treat them almost similarly to an associate
mohammedalee: or there might be a company shifting from equity accounting to consoldiation in the midst of year
mohammedalee: im nt sure hw its relating to planning
sumreenkanwal: hey guys..i ve got a definition of horizontal audit..shud i share
sumreenkanwal: its a general one
mohammedalee: yes sure
sumreenkanwal: not from teh study text
omer321: go on
sumreenkanwal: A horizontal audit assesses the same process across different groups or departments, while a vertical audit assesses all the activities in a given department. Horizontal audits may
be appropriate for such things as employee training and internal controls.
mohammedalee: leaves me more confused
sumreenkanwal: one more
sumreenkanwal: An evaluation of one process or activity across several groups or departments within an enterprise. A horizontal audit is appropriate for processes and activities that are similar
across a number of functional groups in a company, in order to assess the effectiveness of the common approach.
mohammedalee: no non nooooooo
ayman85: i think i will read up on this
ayman85: neither of us really know
ayman85: theres is no point
mohammedalee: its telling abt single company and its deprarmtnes
omer321: horizontal groups
mohammedalee: its nt telling anywhere abt other entities
mohammedalee: so fails the purpose
ayman85: i think this refers to associates
ayman85: but thats my guess
sumreenkanwal: so..it may be suditing with similar approach..a ll the subs of a group
mohammedalee: this what? sory?
ayman85: guys i need to eat dinner
mohammedalee: i need to find the dinner!
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