1.

EXECUTIVE SUMMARY:
As a summarized form of report below, the report is written in the aspect of writing by a review over
the financial report of the latest year. This report entails the review over the auditor’s report as the
report below is prepared after analysing the latest financial report of the company. We prepared the
reports according to the main points as a section suggesting the introduction of company and key
highlights of the report below. While reviewing the financial statements it came into my notice as a
highlight the auditor has complied with the auditing standards applicable in the jurisdiction in which
company exists.

There were few non-audit services that were a part of auditor’s services and this is suggested by the
remuneration part of the financial report as it contained the amount of fee taken against the
provision of non-audit services.

Auditor’s remuneration section is also reviewed and it shows that the remuneration amount as fees
of services provided. Key audit matters on which auditor has reported the way they are audited and
procedures performed by auditor as a result of assessing them as key matter to be discussed are all
analysed as part of report along with a review over the audit committee in company as to whether it
is according to the requirements of corporate act.

Audit opinion is also a part of our report while there is a difference between the auditor’s and
management responsibilities and they are all highlighted in another part of the report below.

There were few subsequent events that occur after the reporting period ended and they are
assessed as to the auditor’s view and whether the auditor report is containing an assessment of the
same or not.

Overall effectiveness of the information is also endorsed as part of this report while if there is any is-
represented information.

Concluding with the assessment of financial report is the last part of our report, stating , the
reported information by the auditor I would certainly say there could be more information sharable
as part of audit such as the provision of other services showing what were the services

2. CONTENTS:
1. EXECUTIVE SUMMARY:..................................................................................................................1
3. INTRODUCTION:............................................................................................................................2
4. REVIEW OF ASSURANCE SERVICE:.................................................................................................2
4.1. COMPLIANCE WITH INDEPENDENCE REQUIREMENTS:..........................................................2
4.2. NON-AUDIT SERVICES:...........................................................................................................3
4.3. AUDITOR’S REMMUNERATION:.............................................................................................3
4.4. KEY AUDIT MATTERS:.............................................................................................................4
4.5. AUDIT COMMITTEE:...............................................................................................................5
4.6. AUDIT OPINION:....................................................................................................................5
4.7. AUDITOR’S RESPONSIBILITIES VS MANAGEMENT’S RESPONSIBILITIES:.................................5
 4.8. SUBSEQUENT EVENTS:...........................................................................................................6
4.9. EFFECTIVENESS OF MATERIAL INFORMATION REPORTED:....................................................6
4.10. MIS-REPRESENTED MATERIAL INFORMATION:..................................................................6
4.11. FOLLOW-UP QUESTIONS FOR AGM:..................................................................................6
5. CONCLUSION:................................................................................................................................7
6. REFERENCES:.................................................................................................................................7

3. INTRODUCTION:
The company “Flight Centre” is a travel agency that operates worldwide traveling, arranges tourism,
airlines and ticketing as per availability of flights, rail passes, travel insurances, visas, travel advisory
and requirements regarding foreign currency. The scope of this report entails the review over the
auditor’s report as the report below is prepared after analysing the latest financial report of the
company. We prepared the reports according to the main points as follows:

-Whether the auditor has complied with the independence requirements, including the composition
and availability of audit committees.

-Provision of non-audit services provided to Flight centre ltd in the year ending in 2017 suggests that
this has been reflected by the management that non-such services are provided while remuneration
suggests there were some.

-Third section contains report on auditor’s remuneration. In the first section it’s the amount EY has
already received or is to receive from company and from the total amount the worth of tax
compliance and other services is quite less than that of the audit engagement.

- In relation to such matters that are in auditors view of this much importance that auditor think
should be a part of report reflecting the importance of matter while audit was undertaken. These are
only the matters that are in auditors view important to be discussed. Among all the matters auditor
discussed with those charged with governance these are few imperative ones.

4. REVIEW OF ASSURANCE SERVICE:

4.1. COMPLIANCE WITH INDEPENDENCE REQUIREMENTS:
Yes, the auditor Ernest & Young has complied with the independence requirements of auditor as
required by the AUASB.

[ CITATION APE \l 2057 ] requires regarding the code of ethics among which independence of an
auditor is an imperative requirement. The first section in annual report has the heading of NON-
AUDIT SERVICES in which the auditors refer to the APES110 code for stating that they have complied
with the requirement of independence by the code.

It is also asserted that the audit and risk committees that are all composed of Non-executives has
complied to review the work of auditors thereby ensuring the interest of shareholders and this
reflects the auditors’ assertion about the independence and objectivity of audit.
Auditor’s independence section is the one in which it is specifically endorsed that we are
independent according to the [ CITATION SEC \l 2057 ].

4.2. NON-AUDIT SERVICES:

There were no non-audit services provided to Flight centre ltd in the year ending in 2017 and a
clause set out in section “NON-AUDIT SERVICES” in the start of the report suggests that this has been
reflected by the management that non such services are provided while if there is any the
management has ensured that it does not compromise those requirements related to independence
of audit as laid out by the corporations act and this is quite enough to suggest that there were no
other services provided.

Remuneration suggest that the auditor has provided non-assurance services to the company as well
as its tax compliance and has charged too.

There should have been a separate disclosure of such services by the auditor instead of just through
remuneration sections the user would come to know about other services.

4.3. AUDITOR’S REMMUNERATION:

In the first section its the amount EY has already received or is to receive from company and from
the total amount the worth of tax compliance and other services is quite less than that of the audit
engagement showing the auditor is complying with code and is apparent to be truly endorsing the
current position of its independence. While the remuneration also contains a section that shows the
amount auditor would as part of other practices such as the review of consolidated statements or
that of other entity’s statement, any audit of special nature required by the law or regulations. The
remuneration section shows some overall strong position of auditor while if we analyse the auditor
dependency on the fee we would also need the fee structure with other organizations company is
auditing.

4.4. KEY AUDIT MATTERS:

In relation to such matters that are in auditors view of this much importance that auditor think
should be a part of report reflecting the importance of matter while audit was undertaken. These are
only the matters that are in auditors view important to be discussed. Among all the matters auditor
discussed with those charged with governance these are few imperative ones.

Audit procedures would also include risk assessment and other areas while initiating the audit
because if the risk is assessed high this would be a part of KAM in report with respect to the area for
which risk is high.

The auditor endorsed in this section of report that there are procedures performed over the risk
assessment and the highlighted matters are then the part of this report while the risk is that of a
material miss statement.

The first KAM presents the impairment tested on assets while the auditor endorsed that because the
size of assets that are tested was large we made it a part of KAM including the way auditor made the
procedure to verify the tests undertaken as accuracy testing, historical reliability of cash flows in the
group and valuation specialist were used because there are assumptions used in valuation of assets

Business has made acquisitions in the year and these are also a part of report on KAMs. Procedures
for assessing the number of acquisitions that made business combination as a result are assessment
of transaction in line with that of standard applicable, procedures over the determination of fair
value of acquired business and lastly the required set of disclosure are analysed to the extent of
adequately disclosed.

Third key matter is the law test because there is a law case on going over the company and the
auditor has to test the implications on the reporting requirements. The auditor has assessed
whether there are any expected penalties or not with applied procedures on ability to estimate the
penalties.

Obtained a written representation from the company management over the matter and enquiries
are made to them in order to get to the factuality of disclosed information.

Forth and last Matter discussed is tge the judgemental asset that was supplier rebate and because it
is material its recoverability should have been analysed by the auditors in terms of financial impact it
would have as a result. Sample testing of override debtors is done along with the testing of
assessment on re negotiation done while the past is analysed for the same. The method that is used
to derive the revenue from such debtors is also a part on which auditors applied procedures.

4.5. AUDIT COMMITTEE:

There is no separate audit committee in the board instead there is one committee combined for
audit & risk and known as audit and risk committee. It is composed of four members are all non-
executives and thereby the standards’ requirements for majority NED’s composition is fulfilling the
quality of committee with fit set of rigorous review over the auditor’s independence.

No separately identify charter found in the report however there is one person with chairman ship
of audit and risk committee but there is no separate disclosure of company’s audit & risk committee
and its operations and functions it performs.

R.A. Baker FCA, GAICD, B Bus (Accountancy) Age: 59 the chairman of committee.

4.6. AUDIT OPINION:

UN-MODIFIED audit opinion is provided on the audit of financial statements for the year ending
30/06/2017 stating that the report represents true and fair view in accordance with those relevant
standards and the applicable laws (Australian laws and regulations) and the act which is corporations
act are all complied by in auditor’s judgement. While opinions basis is expressed in para next to the
opinion stating the basis as the reporting standards were followed by in view of auditor.

4.7. AUDITOR’S RESPONSIBILITIES VS MANAGEMENT’S

RESPONSIBILITIES:
Management of a company i.e. its board and other employees are all responsible in preparation and
a fair presentation of financial statements. Preparation of financial statements is started from the
control and operations within the organization and this requires the organization’s management to
have a strong set of control over the operations because this control defines the faithful
representation of financial statements with respect to all the assertions of financial statements.

Each individual of the organization is to an extent a control procedure by the board and this entails
the operations ultimately. This is the responsibility of Management of the company to ensure the
procedures in place that can make ground of all assertions on financial statements.
Shareholders are the investors that require the auditor’s report on the financial statements and the
responsibility in other terms for management is all about the responsibility to report the
transactions and events that took place in the period for which financial statements are prepared
and as far as assertions are concerned, they are the assertions in literal terms that these five
elements regarding financial statements are asserted by the management that report is based upon
all five features of:

1. Completeness stating all transactions are recorded, completely.

2. Accuracy states those all transactions have accurately calculated by the management.
3. Existence ensures the recorded transactions actually exist such as the recorded set of Non-
current assets.
4. Occurrence regards the recorded transactions actually took place or actually occurred.
5. Rights and Obligations of all owned Assets and Liabilities belong to our organization.

So, the assertions are in fact the responsibility of Management to comply with and comply with the
reporting standards set by the bodies such as IFRSs for UK and GAAPs for US are the relevant
reporting standards. Also, compliance with applicable laws and regulations is their responsibility
While the auditors are hired by the shareholders to report on the stewardship of management
regarding the assertions, if the reporting statements are true and fair in the spirit and depict the
assertions. It is auditor’s responsibility to check for the transaction and events on sample basis and
do the same while complying with the applicable auditing standards in the jurisdiction in which
company exists and audit is performed.

4.8. SUBSEQUENT EVENTS:

Yes their events occurred after the end if period for which audit is undertaken that is after
30/06/2017 such as the dividend was declared after the reporting period and is a part of report
however it was not an adjustable event.

Other events include the acquisition that took place after year end and occurred on 24 July 2017
while if it is major acquisition it should have been disclosed in the financial statements and is
accurately presented but because it was announced after year end it is not required to be adjusted.
Four other acquisitions took place subsequent to the year ended.

4.9. EFFECTIVENESS OF MATERIAL INFORMATION REPORTED:

As an overall assessment to the reported information by the auditor I would certainly say there
could be more information sharable as part of audit such as the provision of other services showing
what were the services and how they were provided with independence and objectivity un harmed
as auditors.

The overall effectiveness of the information shared is quite impressive and specially KAM is much
well-organized showing what the audit think should is also imperative to my being an interested
third-party stakeholder concern.

There is a fine compliance with auditing standards as far as my knowledge is in time.

4.10. MIS-REPRESENTED MATERIAL INFORMATION:

Audit opinion is un-modified suggesting there is no mis representation found. Opinion is audit
opinion is provided on the audit of financial statements for the year ending 30/06/2017 stating that
the report represents true and fair view in accordance with those relevant standards and the
applicable laws

4.11. FOLLOW-UP QUESTIONS FOR AGM:

Probably why the audit report does not contain disclosure of what other services were provided to
the company.

5. CONCLUSION:
In conclusion to above report, the reported information by the auditor I would certainly say there
could be more information sharable as part of audit such as the provision of other services showing
what were the services and how they were provided with independence and objectivity un harmed
as auditors. The scope of this report entails the review over the auditor’s report as the report below
is prepared after analysing the latest financial report of the company.

6. REFERENCES:
ACCA examining team. (n.d.). Paper P7 Advance Audit & Assurance. ACC GLOBAL WALL: WEBSITE.

APES110 Code of Ethics for Professional Accountants. (n.d.).

Australian Auditing Standards. (2010). ASA 300 Planning an Audit of a Financial Report. Australia:
membershandbook.charteredaccountants.

Brown, G. (n.d.). Types of Analytical Procedure Audits. SMALLBUSINESS.CHRON.

Lee, P. (Director). (Published on Aug 27, 2016). 1.6 - Materiality, Audit Risk, & Audit Evidence - An
Overview of Auditing for Auditors [Motion Picture].

pbouker, & instructor. (n.d.). Chapter 8--Audit Planning and Analytical Procedures.
http://facweb.northseattle.edu/.

PCAOB: (PublicCompanyAccountingOversightBoard). (Dec15,2010). AS2101:Audit Planning.

PCAOBReleaseNo.2010-004.

Review, R. C. (Director). (Published on Jul 31, 2015). Audit Evidence: Analytical Procedures - Lesson 1
[Motion Picture].

SECTION NUMBER 307 C of Corporations Act 2001. (n.d.).