ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p1

Diary Delight Ltd

30/6/2023
Working Paper

1. Working Paper Schedule A-1

Diary Delight Ltd

Determine the Acceptable Audit Risk
30/6/2023
Schedule A-1
Prepared by: [Your Name] Date:
Reviewed by: Date:

Identified factors influencing the auditors’ judgement of the audit risk:

Conclusion:
ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p2

2. (a) Working Paper Schedule B-1

Diary Delight Ltd
Inherent Risk Assessment
30/6/2023
Schedule B-1
Prepared by: [Your Name] Date:
Reviewed by: Date:
Accounts/Item at Inherent risk factor Impact of the
risk factor on
inherent risk
(Increase/decre
ase inherent
risk)

Please add or remove rows as appropriate.

ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p3

2.(b) Working Paper Schedule B-2

Diary Delight Ltd
Analytical Procedure
Ratio Analysis
30/6/2023
Schedule B-2
Prepared by: [Your Name] Date:
Reviewed by: Date:
Ratio 2023 (Unaudited) 2022 (Audited) Analysis

Percentage of bad
debt in revenue=
Bad debt
expense/Revenue

Average number of
days to sell
inventory= (365
days* End of year
inventory
balance)/Cost of
sales
ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p4

2.(c) Working Paper Schedule B-3

Diary Delight Ltd
Analysis of Accounts Receivable
30/6/2023
Schedule B-3
Prepared by: [Your Name] Date:
Reviewed by: Date:

A/R Category Account Receivable Estimated Estimated allowance for doubtful debts
Balance allowance
percentage
Global Capital Ltd 5,700,000 ?
0-30 days 7,054,232 5%
31-60 days 820,125 10%
61-90 days 604,253 30%
Over 90 days 335,977 60%
Total

Recorded Provision: ______________________

Conclusion:
ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p5

3. Working Paper Schedule C-1

Diary Delight Ltd
Control Risk Assessment
30/6/2023
Schedule C-1
Prepared by: [Your Name] Date:
Reviewed by: Date:
Internal control/Control deficiency (1 mark each) Discuss impact on control risk assessment (increase/decrease control risk)
and, if any, affected accounts and potential misstatements

Please add or remove rows as appropriate.

5.(a) Working Paper Schedule D-2
ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p6

Diary Delight Ltd

Test of Control
Policy Compliance Check
30/6/2023
Schedule D-2
Prepared by: [Your Name] Date:
Reviewed by: Date:
Internal control The company requires that international hotel accommodations must
not exceed $350 per night, while domestic accommodations should not
exceed $300 per night.
Relevant audit objective(s) and account(s)
Test of control procedure

Deviation rate (Show detailed calculation)

Tolerable deviation rate for a low control risk 5%
assessment

Conclusion:
ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p7

5.(b) Working Paper Schedule D-3

Diary Delight Ltd
Dollar Unit Sampling for External Confirmation
Accounts Receivable
30/6/2023
Schedule D-3
Prepared by: [Your Name] Date:
Reviewed by: Date:
Key Parameters for DUS:
Population ?
Sampling unit A dollar
Tolerable misstatements for the test $1,451,459
Allowable risk of incorrect acceptance 5%
Expected population misstatement $145,146
Sample size ?

Systematic Sampling
Sample interval (Rounded to the nearest dollar) ?
Random number from the first interval 150,000
Formula to identify random dollars ?
ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p8

Sort the customer list ascending by customer name, apply dollar unit sampling and list
the debtors in the sample.
Sampl Customer Name Account Receivable Balance Cumulative Total
e
1
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40
ACCT3101 S2, 2023, Case Study Your First Name, Last Name/Student Number p9

Please add or remove rows as appropriate.