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For Pyq June 2015 Q5 (a)-Fraud responsibilities
1)”For members not present at the meeting, Sycamore’s audit engagement partner should
determine which matters are to be communicated to them.”Is it should be Maple & Co audit engagement partner as Sycamore is an audit client?
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1) “In addition, the reason for the increased level of returns
should be discussed with management. This will help to
assess if there are underlying issues with the net realisable
value of inventory.”Does the sales return increase indicate the reduced in quality of the product, therefore, the Selling price and NRV of inventory?
2)”The finance costs should be recalculated and any increase
agreed to the loan documentation for confirmation of interest
rates and cashbook and bank statements to confirm the
amount was paid and is not therefore a year-end payable.”Why the finance cost must be paid and cannot be payable in the year end?
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June 2015 -Section AQ9: is it the audit opinion still can be changed after the audit report is signed but before the financial statement is issued?
Thank you.
1 Means the partner of Maple who is the engagement partner for the audit of Sycamore.
You are correct about reviewing returns. The fear is that they were caused by poor products whose value might need to be written down.
2 Finance xosts will eifher be paid or must be accrued. If the amount paid is less than due and accrual must be established.
Q9 Yes. It can even be changed after the FS are issued though that is rare. Then, the FS have to be withdrawn and reissued or if management refuses, the auditor must write to members to inform them.
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