*** P7 June 2013 Exam was.. Post your comments ***

@basilahmedh

This is exactly what I done mate so hopefully, I said there was nothing wrong with providing non audit services as long as safeguards were in place. I recommended to discuss it with both clients as confidentiality was involved and also Self Review threats can exist as we will be providing a report on the areas we have audited for the other client.

I hope I pass, think the paper was fair although very time pressured(too much information and all appears relevant to what is required):

Question 1:

a)Detailed analytical procedures mainly accounting ratios of profitability, liquidity and solvency. Described the audit risks that I could identify and recommended additional information that may be required.
b) Discussed the ethical problems of accepting the due dilligence procedure as was an audit client!
Used the briefing note format, addressee, introduction, body split between a and b and a conclusion on both a and b.

Question 2
a) Quality control, ethical issues about junior staff being assigned complex tasks etc think got enough points for at least 50% of the marks
b) Forensic audit made some points about what we should do in planning for the engagement and then spoke about audit procedures that would be required to be performed to assess the extent of the fraud (Not sure will see how this pans out, hadn’t read that section)

Question 3
Application of different standards and what I would expect to find to address the risks that the specific standards pose! IFRS5, IAS17 and disposal and revaluation IAS16, and license IAS 38 intangible assets, hope I scrape!

Question 5
IAS 37 provision and adjustment to amount recognised even though not in line with local reporting requirement do not recognise in individual accounts but qualifies for recognition in consol accounts per IFRS so make adj for that. audit report would be modified if not adjusted said material not pervasive so modified and not adverse!

Trade receivable material balance, and significant overstatement of profit and receivables therefore adjust. Also said that audit report would be modified if not adjusted said material not pervasive so modified and not adverse!

Chairmans statement needed to bring in line with financials as they will be presented together, Request he adjusts his statement if not include other matter in report detailing the impact!

Hope this gets me a pass! Hopefully my first and last attempt at this paper! Good luck to all

Hi

i believe the chairman’s report isnt audited as such and only reviewed for consistency with the FS, if not amended then only need to make users of the accounts aware of the inconsistency.

<cite> @bmparadzi said:</cite>
Not sure it is pervasive and he did not lie that has to be established need to enquire with him and propose adjustment if not adjusted then other matter in opinion paragraph! We would have performed detailed procedures on revenue and would have established that it is ok and no qualification! Have a read on other procedures!

Agree in an other matter paragraph!

The revenue figures were given though and there was only 5 % increase.

However you guys are right as chairman’s statement is not audited.

Oh well there goes question 5 down the drain.

<cite>@jackbailey02 said:</cite>
On question 1 part 1, ive mainly compared this years figures to last years and worked out percentage rises and falls, then talked about material percentages. People talking about gearing ratios etc has got me worried. I didnt use any of the standard ratios. I thought the question was more aimed at analytical proceedures as in compare this years accounts to last years and seeing what big changes there are – this is where you will find the audit risks. Does this sound okay?

But aren’t accounting ratios part of of analytical procedures? I would think so and would be better place in the scenario than merely noting movements arent you trying to etsblish level of risk by doing these procedures and going concern? Don’t know maybe just me!

Question 1 part a was almost same as OAK of Dec ’11 attempt. The only thing was the additional information which I failed to write and which I hope isn’t worth too many marks 🙁

Just looked at Oak you are right very identical.

However the good news is that in the answer the book states that you do not need to do that many calculations and that they are capped at 4 marks and the answer is more on management bias, going concern, accounting treatments and ofcourse liquidity too.

Q5 the inconsistency in the information provided by the chairman gives rise to Other matter paragraph which is not a modification of the audit report. i don’t know if its right oops!!!

did all first 4 questions but time pressured, so didnt go in too much detail for Q3 & Q4. InshaAllah hoping for a PASS

<cite> @bmparadzi said:</cite>
correct

I wrote it the other way around 😐