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At the planning meeting, it was decided that an auditor’s expert should be sought in relation to the valuation of Truse Co’s properties as the company has not used an independent valuer.
ISA 620 states that the nature, timing and extent of audit procedures to evaluate the work of the auditor’s expert depend on the circumstances of the engagement.
Which of the following matters should the audit team NOT consider in determining the nature, timing and extent of these audit procedures?
A The risk of material misstatement associated with Truse Co’s properties
B WSD & Co’s experience with previous work performed by the expert
C Whether the expert is subject to WSD & Co’s quality control policies and procedures
D The existence of any interests in or relationships with Truse Co that might pose a threat to the expert’s objectivity
hi sir,I have a question why The existence of any interests in or relationships with Truse Co that might pose a threat to the expert’s objectivity NOT consider in determining the nature, timing and extent of these audit procedures?If the expert had interests or a relationship with Truse, that expert should not have been used in the first place as the expert is not independent.
”Inspect prior year working papers to look out for any past experience of obsolescence that would indicate the NRV has gone down. This confirms the valuation is adequate.”
”For a sample of plant, compare the market selling price to amounts in the sales invoice after examining prevailing market conditions. This verifies completeness”
Are these valid audit procedures to verify a company’s estimate of NRV of plant & equipment?
As in Qn. 61 LSBF Revision kit…Newthorpe Engineering Co.
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