TUTORIAL 1 - 3

ACC 471 AUDITING

AUDITING AND COMPANIES ACT, PROFESSIONAL RULES

1. Define an audit.

2. What does the concept of stewardship mean to the auditor?

3. Is the auditor responsible for detecting fraud?

4. What are the main stages of the audit?

5. What does RSB mean?

6. What is a SAS?

7. What does ASB mean?

8. What aspects of auditing are regulated by the Companies Acts?

9. What is the expectation gap?

10. Who may appoint the first auditors of a company?

11. What action should a company take if the auditor resigns prior to completion of
his term of office?

12. What are the duties of the auditor under the Companies Acts?

13. What do you understand by the concept of materiality in relation to an audit?

14. What meanings could be attached to the words ‘true and fair’?

15. Does agency theory conclude that directors will encourage or discourage
auditing?

16. List the people and groups of people who are likely to be interested in financial
statements.

17. What other services do accountants provide in addition to auditing?

18. What is the primary objective of an audit?

19. What other benefits are obtained?

20. What are the objectives of an audit report?

21. Distinguish statutory audits, private audits, internal audits and other audits.

22. What qualities are required in an auditor?

23. What must be contained in the Auditor’s report?

24. Summarise s235,s237 and s389 CA 1985.

25. Why may an auditor wish to resign?

26. Who cannot be a company’s auditor?

27. How can an auditor be removed from office?

28. Outline the rules on disclosure of an auditor’s remuneration.

29. What is the definition of an audit committee?

30. When is an engagement letter sent?

31. Who does an engagement letter specify is primarily responsible for the
prevention and detection of irregularities and fraud?

32. How may a firm avoid damaging the interests of clients where there is a
conflict of interests?