[daiem]

Question 1:
(a) Significant Audit Risk (22 marks) – some risks include revenue, inventory returns, detection risk, assets held for sale, amortisation of accounting system, recognition of online sales, provisions
(b) Audit procedures on inventory returns (8 marks)
(c) Audit implications in terms of NOCLAR (10 marks)

Question 2: Quality mngt, ethical and professional issues
(i) (dont remember exactly) – 7 marks
(ii) reliance on IT system, control deficiencies detected but not further audit procedures performed – 6 marks
(iii) providing results of audit data analytics from audit client to audit firm and expection bonus payment ( not really sure if its right) – 7 marks

Question 3
(a)(i) sufficiency of audit evidence – the case talk above renegotiation to the bank to extend loan , sale of property but revaluation not up to date, finance director lack integrity – 7 marks
(a)(ii) Audit procedures on issues leading to co. being going concern – 7 marks
(b) criticize auditor report – MURGC paragraph not provided – 6 marks

[daiem]

I think it was for 8 mrks
Apv vs npv 6 mrks
Discussion on estimates 6 mrks
Estimate asset beta 7 mrks
Ke kd and wacc 13 mrks
Secutisation 6 mrks
Professional mrks 4 mrks
Can someone check if this is correct for Q1

[daiem]

Q1
-Factors to consider for debt finance compare to equity finance
-Estimate average asset betas
-Estimate cost of debt, cost of equity and cost of capital
-Justifies and i think advise on estimate calculated above
-Apv vs npv
_Secutisation of income i think
Q2
Hedging payment if interest increase to 4.4%
-FRA, futures and options and recommendation
FRA lower and options highest
-Value at risk for Npv
-Centralized treasury dept
Q3
-Calculate expected sales and
Impact on FS and EPS
-Comment on directors view not to improve liquidity and to keep NCA i think
Feasibility of selling division and if co. Agree to it something like that

[Author]

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