AA Flashcards
What are the auditors responsibilities?
- Carry out services in accordance with professional and ethical standards x
- Carry out services in accordance with the engagement.
- Forming an independent opinion on the truth and fairness of financial statements.
- Confirming that the information contained within the directors report is consistent with the accounts.
- Confirming that’s the directors use of a going concern of accounting in the preparation of financial statements is appropriate.
What are the objectives of audit quality management?
- To fulfil the auditors responsibilities in accordance with professional standards.
- To ensure engagement reports issued by the firm or engagement partners are appropriate in the circumstances.
- To maintain professional competence and due care.
- To make sure the audit runs efficiently in a cost effective way.
What are managements responsibilities?
- Managing the business so as to achieve company objectives.
- Assessing business risks to those objectives being achieved.
- Keeping proper accounting records.
- Safeguarding company assets.
5 . Preparing financial statements and delivering them to the registrar. - Ensuring the company complies with applicable laws and regulations.
When should an emphasis of matter paragraph be issued?
When it is necessary to draw the users attention to matters presented in the financial statements that are of such importance that they are fundamental to the users understanding of the financial statements.
When is an other matter paragraph used in an auditors report ?
To draw the users attention to matter others than those presented or disclosed in the financial statements that aid their understanding of the audit.
What was included in the Bryden report ?
- A redefinition of audit and its purpose.
- The creation of a corporate auditing profession.
- Changed to the audio opinion from true and fair to present fairly in all material aspects.
- Directors to present the shareholders with a three year rolling audit and assurance policy.
- Audit transparency would increase.
What is the paragraph relating to going concern?
Material uncertainty related to going concern.
What is the purpose of an emphasis of matter paragraph ?
Clarify a significant issue.
Emphasis of matter for disclosure notes.
Draw attention to a major uncertainty.
What is the purpose of the key audit matters paragraph?
This is required for a listed or public interest entities in certain jurisdictions.
It is to:
- enhance the communicative value of the auditors report.
- provide greater transparency about the audit that was performed.
- provide additional information to users to add ist them in understanding.
- close the expectations gap.
What is the other information paragraph used for ?
This addresses other information outside of the financial statements like sustainability issues.
This will also be used to state whether that are any inconsistently between the financial statements.
What is the other matter paragraph used for ?
To make a point on information which does not conecenr the issue affecting the financial statements fairness but still affects the audit opinion such as subsequent events.
What are the parts of the completion analytical review?
- Perform analytical procedures.
- Interpretation.
- Investigation.
- Corroboration.
Compare audit plan to working papered to determine or processes have been completed correctly.
Review the working papers.
Determine if the sufficient appropriate evidence has been collected.
What is the difference for the audit report of a listed and non listed?
- Key audit matters.
- A statement of by whom / which body the auditor was appointed by.
- An opinion on whether the corporate governance statement is consistent with the annual accounts and prepared in accordance with legal requirements.
- Specification of materiality and performance materiality.
What are the auditors rights and responsibilities when they are not in intend to continue as auditors on a listed company?
Rights:
- Speak at the AGM
- Circulate a written statement to members.
Responsibilities:
- deposit a statement of circumstances
at walnuts registered office.
- as walnut is a listed company there is no option to state there are no circumstances.
- cooperate with the incoming auditor.
- maintain client confidentiality.
