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Advanced Audit and Assurance: Acca Aaa
Advanced Audit and Assurance: Acca Aaa
Advanced Audit and Assurance: Acca Aaa
Additional
information
relevant in the evaluation of audit risk.
Kindly note that the content’s of this lecture support note is the summary of the past
ACCA exams. The purpose of this note is to provide my students with an insight to write
their examination properly and it is not meant for any kind of commercial purpose.
This is not a substitute for the complete textbook, so please use this note for the final
revision and practice revision kit of ACCA approved publishers for good results.
- Copies of working papers from the previous auditor to perform testing on opening
balances.
- Details of experience and qualifications of the staff (director or any other person) to
assess competence.
- Breakdown of cost of sales and operating costs ( or any other items) to review for
misclassification between proper accounts.
- A breakdown of current liabilities/ (current assets) to establish the reasons for the
decrease/(increase) as compared with the prior year.
- Details of the loan taken out, including a copy of the new loan agreement to establish the
interest rate payable, repayment terms and whether any borrowing costs other than
interest were incurred.
- Any information available in relation to the flotation, for example, investor prospectus,
pre- and post-flotation press releases, communications with the stock exchange
registrar.
- A breakdown of current assets so the individual figures for inventories, receivables and
cash (and any other current assets recognised in the statement of financial position) can
be identified and trends established.
- A full set of forecast financial statements including a statement of cash flows to assess
the working capital issues faced by the company.
- Copies of agreements with the bank ( or any other creditor) so that terms of credit can be
verified and to assess their possible impact on the financial statements .
- Legal documentation for the purchase of associate should be reviewed, including voting
rights acquired, to determine the extent to which control can be exercised by parent as
this will impact the treatment in the financial statements.
- Information on the background and experience of the new non- executive directors and
the new finance director, for example, their professional qualifications and previous
employment or directorships held.
- Details on the valuation (of properties) including the date of the revaluation and
information on the valuer such as their professional qualification and relationship with
- Details of the internal auditor’s qualifications and experience should be obtained and
reviewed to assess their competence before relying on their work.
- Notes of discussions held with internal audit to assess whether there are any other fraud
risks of which they are aware which could impact our audit approach.
- Details of the potential acquisition of the company such as the likely completion date. If
the acquisition is completed before the auditor’s report is signed it will need to be
disclosed as a non-adjusting event and will therefore impact our subsequent events
procedures.
- Details of the stock exchange listing during the year including the terms of the flotation,
number of equity shares issued and amount of equity capital raised.
- Information on the specific listing rules relevant to the stock exchange, for example, the
corporate governance code and disclosures necessary in company annual reports and
financial statements.
- Details on the planned foreign stock exchange listing , including the jurisdiction, the
strategic rationale for seeking the listing and proposed timescales.
- Internal audit reports should be reviewed to evaluate findings and determine whether the
work of the internal audit department is adequate for audit purposes.
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