d. Which of the following correctly identifies a risk facing SSC that might affect its ability to continue as a going concern over the long run? Multiple Choice Competition from several competitors. Your CPA firm's decision to issue standard unmodified audit reports not mentioning the going-concern status during the past five years. Obsolescence of all products due to rapid changes in technology in the industry.

d. Which of the following correctly identifies a risk facing SSC that might affect its ability to continue as a going concern over the long run? Multiple Choice Competition from several competitors. Your CPA firm's decision to issue standard unmodified audit reports not mentioning the going-concern status during the past five years. Obsolescence of all products due to rapid changes in technology in the industry.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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5. During the year, changes in the market resulted in a significant decrease in the demand products, which are now being sold significantly below cost. The client refuses to write- products or to increase the reserve for obsolescence, the auditor should issue a(n): a) Unqualified opinion. Unqualified opinion with explanatory paragraph. Qualified opinion. Adverse opinion. Disclaimer of opinion. b) c) d) e)
As the acceptable level of detection risk increases, an auditor may: Oa. Lower the assessed level of inherent risk. O b. Eliminate the assessed level of control risk from consideration as a planning factor. O c. Change the planned timing of substantive tests from year-end to interim. Od. Increase the risk of material misstatement.
Discuss the concept of professional skepticism and its importance in audit. Why is it sometimes difficult for auditors to exercise appropriate levels of professional skepticism in practice? 3.A company has been making losses on its operations due to many factors such as competition, impairment of some of its non-current assets and losses incurred on derivatives in its hedging activities as well as problems of complying with many laws and regulations governing its operations. RequiredAs the audit manager in charge of the audit of this company, evaluate the areas in the audit of your client where the audit team members need to exercise a high level of professional skepticism.
Carinal Ltd. specializes in the development of electronic components within quite acompetitive environment causing concerns for marketing and pricing. Its non-current assetsprimarily include IT software, property, and investments, and there have been additions tothese during the year.As audit manager, you are conducting a preliminary analytical review and associated riskanalysis for this client for the year ended June 30 2022. You have been presented with thefollowing draft financial information about Carinal with incomplete ratios and percentagescalculation. INCOME STATEMENT Year ended June 30 2022 2021 $'000 $'000Revenue…
After the audit planning procedures, your audit team decided to place the preliminary audit risk at a high level. Which of the following is correct? A. The risk the planned further audit procedures will not be able to detect misstatement should be increased. B. The auditors should plan set the timing of its extensive substantive testing at year-end. C. The audit materiality levels should be increased. D. The auditors should plan extensive substantive testing through analytical procedures.
Which of the following is NOT a reason the auditor performs some substantive procedures at an interim audit date? O increase the effectiveness of the overall audit O client may require it for reporting purposes O allow the audit firm to decrease the amount of work during their 'busy season' O increases the efficiency of the year-end audit
None
For every of the following independent situation, discuss the issue and describe the impact report with provide examples Ii. During the audit, your team has diagnosed an blunders in the valuation of work in development,as a number of the assumptions contain obsolete statistics. The administrators of Amar Syawal Bhd. Have indicated that they do not desire to amend the monetary assertion
DETERMINE WHETHER TRUE OR FALSE S1- Toward the end of an engagement, after all audit evidence has been gathered by the auditor, the auditor again considers materiality by comparing the combined misstatements with the preliminary or revised estimate for the entire set of the financial statements as a whole. S2- Changes in the regulatory or operating environment can result in changes in competitive pressures and significantly different risks.
2. An audit firm is required to perform a risk assessment in order to determine whether to accept the new client or continue with repeat clients annually. Question 2 options: a) True b) False
Carinal Ltd. specializes in the development of electronic components within quite acompetitive environment causing concerns for marketing and pricing. Its non-current assetsprimarily include IT software, property, and investments, and there have been additions tothese during the year.As audit manager, you are conducting a preliminary analytical review and associated riskanalysis for this client for the year ended June 30 2022. You have been presented with thefollowing draft financial information about Carinal with incomplete ratios and percentagescalculation. INCOME STATEMENT Year ended June 30 2022 2021 $'000 $'000Revenue 22450 18675Cost of sales 8475 8055Gross Profit 13975 10620Distribution costs 4245 3120Administrative expenses 1276 2134Selling expenses 5555 512Profit from operations 2899 4854Net interest receivable 1245 495Profit before tax 4144 5349Income tax expense 2145 2345Net profit 1999 3004Retained profits 1325 2105Dividends paid $1250 $1049Accounting ratios and…