Revaluation of property and disclosure

Hi Mr Smith,

I always come accross in the module answers that we have to check the disclosures of the assertion or the response to the weakness in the the control system.

but how we will decide that this item should be included in the disclosure ,or that every thing should be disclosed or what?

Thanks for help.

like in the following question:

Q
IPRO EDUCATION
+917742693555
You are an audit senior for Rio & Co. were recently appointed as external auditors of
Handy Car Co for the year ending 31 June 20X7 and you are in the process of
planning the audit.

The workshop currently in use is owned by the company and will be included in
the financial statements at its revalued amount rather than at cost. The company
has always adopted this policy for land and buildings and the valuation of the
workshop is to be brought up to date at 31 March 20X7 by an external valuer
Prat (c)
Required
Describe the procedures the auditor should carry out to gain evidence over the
adequacy of the value of the workshop and the related disclosures included in
the financial statements.

Answer

(C) Procedures in relation to property valuation and related disclosures
Obtain a copy of the valuer’s report and consider the reliability of the valuation
after taking account of:
– Independence/objectivity
– The basis of valuation
– Qualifications
– Experience
– Reputation of the valuer.
Compare the valuation with the value of other similar properties in the locality
and investigate any significant difference.
Re perform the calculation of the revaluation adjustments and ensure the correct
accounting treatment has been applied.
Inspect notes to the financial statements to ensure appropriate disclosures have
been made in accordance with IFRSs.