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I’d just like to point out that the question said bonuses were also capped at 20% therefore for M the bonus amount was £48k (20% * 240,000).
I think they will just mark your first 8, but maybe your best 8. Personally I’d develop your other 8 instead of writing a 9th+ as you get no additional marks so effectively wasting time?
Agreed! I got 49% on my first attempt in March and I had 15 mins spare. This sitting had so much to read & write that I only managed to do 7/8 audit risks – I needed an extra few mins lol
For the £3.9m painting the directors were aware of the conditions at the financial statement year end which was March. The painting expired February therefore it is an adjusting event which requires adjustment if material individually or in aggregate.
Therefore stock was overstated materially as you could calculate materiality using 5-10% of PBT & 0.5%-1% of turnover.
Therefore if not adjusted the auditor is to issue a qualified opinion ‘financial statements are true and fair except for stock’. However, if they did make this adjustment an unmodified report can be issued.
I may be mistaken but more was required as there were 2 NED’s and 3 ED’s. Has to be 50/50 I think. So whoever was the most independent, but I can’t remember the question tbf
The 8 audit risks had 10 boxes for me, I tried deleting them but couldn’t find a way! I had to double count to make sure I definitely had 8 risks identified ?
Did anyone get the multiple choice about independency? I went Trish in the end who had retired 5 years ago, but wasn’t 100% sure… I feel like it was none of them.
I did struggle on this one too, the options were like;
1) employees labelling stock as counted
2) Segregation of third party stock
3) Segregation of impaired/damaged stock
4) Employees Opening all boxesFor completeness and existence I went for the 2 segregation’s.
But option 4 was probably one of the correct options as I guess segregation does not test existence??
Well that’s 4% down the bin for me. Wish I had listened to my gut for those two but I stuck with my original answers.
Hopefully I smashed section B 🙂
What did people put for the MCQ –
What two items would impact the independence of the auditor?
E.g
1) Implementation of off the shelf accounting package?
2) design of payroll system?
3) implementation of internal controls?
4) review of system set up by client employee?
I picked 1 and 3, but think I should have gone 2 & 3… anyone else agree?
This was one of 2 questions that did my head in.
In the end I just went for the one person as the supervisor is not completing the audit fieldwork so that seemed fine.
As for the junior with the dad who was a marketing assistant. The risk seemed low but as the question said without the use of safeguards. I thought you can’t use segregation of duties. Therefore the junior could be doing transactional testing around marketing expenditure (P&L) if material enough.
Therefore I did not choose the junior as an option but I probably should have…