Auditing and Assurance Services (16th Edition)
Auditing and Assurance Services (16th Edition)
16th Edition
ISBN: 9780134065823
Author: Alvin A. Arens, Randal J. Elder, Mark S. Beasley, Chris E. Hogan
Publisher: PEARSON
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Chapter 8, Problem 6RQ
To determine

Explain the ways in which CPA’s observations made during the course of the plant tour will help for planning and conducting the audit.

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In deciding whether to accept a new manufacturing client, the auditor arranges a tour of the manufacturing plant. In your words elaborate the information the auditor may obtain during the tour that will help in planning and conducting the audit if client is accepted.
In order to help the audit team assigned to the audit of a major client's property, plant and equipment accounts better understand the link between auditing assertions and this area of the audit, the audit manager with overall responsibility for this part of the audit has convened a meeting. Which of the choices below would be the supervisor's best response to help explain this relationship? The easiest way to understand this relationship is to imagine taking our list of assertions, determining which ones apply to the client's property, plant and equipment accounts, and then finding ways to test the assertions we selected. For example, we might decide to test the valuation and allocation assertion by examining documents to see if the client has defaulted on any debt associated with these assets. The easiest way to understand this relationship is to imagine taking our list of assertions, determining which ones apply to the client's property, plant and equipment accounts, and then…
You have been asked to prepare a presentation to new recruits in your audit firm on the use of working papers. You have also been asked to include in your presentation a distinction between files held in permanent and current files, the design and use of audit programmes and the purpose of an audit trail with respect to the conduct of the audit. Required a) State four matters you would expect to find recorded in working papers in the permanent audit file and explain their purpose. b) Explain the design and use of audit programmes. c) Explain the importance of recording details of the actual evidence examined in the course of the audit on which the conclusions are drawn. d) Post your response to the discussion forum and engage two of your peers in a critically constructive dialogue about their responses.
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