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Please help me how to dealt with the question:what is the matter to be considered before accepting tender of due diligence?What is the difference in the answer comparing with the matter to be considered before accepting review PFI ?Can I be awarded some marks if tell about competence, deadline of audit firm(for tender of due diligence question)?
It sounds like your exam was yesterday so there’s really no point worrying about it now. Yes there will still be some credit for any points made that are relevant to the question set in the context of the scenario.
If the management of target company does not comply with IAS 37 on making provision for sale return, they make provision base on sale amount, why audit firm should pay attention to this matter before tendering due diligence engagement.Please help me to explain.This is also a part of my exam yesterday, I just tell that that estimate is subjective and subject to management bias, breach of financial reporting rule.so, audit firm should pay attention.May I be award any marks for this?
It’s not fair that you ask me when I don’t have access to the Qs and therefore cannot see the bigger picture. For an audit assignment, management’s acknowledgement of its responsibility to prepare financial statements in compliance with the applicable financial reporting would be a “precondition” for accepting the audit. Even if this is not an audit assignment, it is telling you something about management’s integrity – and, as you say, risk of bias.
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