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I wish to find out exactly what the examiner is looking for when the question says: 1)What are the matters to consider…(2) What are the audit procedure you would do.. in a question.? There is usually a thin line in the difference between the two question. Further when do you start talking about the documents?. please help.
Matter to consider carries a broader requirement while the audit procedures one focuses on just the audit procedures.
I know you can confuse both so take a look at this:
Matters:
Breach of law
Breach of IAS/IFRS
State both briefly (If not given in case)
Impact on Audit opinion
Impact on Audit evidence
Impact on independence of auditorAudit Procedures:
Analytical procedures
Enquiry
Inspection
Observation
RecalculationEg
Auditor found obsolete inventory in a warehouse and management refuses to say why they are there.This goes against IAS 2 and if significant can lead to change in opinion (Material). This can reduce cost of sales and increase profits. This can increase assets. They can be illegal and hence question ISA 250.
See if you can apply the points above in this scenario
You talk about documents when talking about inspection. Linking to above example,
Inspect a sample of Goods received notes and review the bin cards to verify the date of their arrival.
Another requirement is audit evidence you should expect to find.
This always talks about documents. Picture yourself as a manager, opening a file for a relevant matter, what would you expect to see there? Goods received notes, correspondence with management, among others
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