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There is this one question in Dec, 2009 Question 1 part c.
”Describe three substantive tests you should perform to ensure that royalties charge is accurate and complete”.
I want to ask that is substantive tests for royalties is in syllabus?
Also please tell me if substantive tests for expenditure and depreciation is in our syllabus for INT F8 in JUNE 2012?Substantive tests are in the syllabus, but you are supposed to be able to design those to suit the details in the scenario given. So, in a club, you could be asked to describe substantive tests for membership fees; for a trust you could be asked to design substantive tests for payments made to beneficiaries. However, full details of the system would be in the scenario and the tests would be very specific.
This means that the answer to your second question is ‘Yes’. Just think about all the tests (Analytical procedures, enquirey and confirmation, inspection observation and recalculation) that would help address the assertions made by the expenditure and depreciation amounts.
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