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AA Question Rote > Substantive Procedures Rote 2 > Flashcards

Substantive Procedures Rote 2 Flashcards

1
Q

PPE (obtain breakdown costs NCA cast breakdown confirm NCA)

A

Obtain breakdown of costs included in non-current assets, cast breakdown and confirm inclusion in non-current assets register

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2
Q

PPE (confirm invoices name of company valuation)

A

Confirm supplier invoices are in the name of COMPANY NAME for valuation and rights and obligations

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3
Q

Inventory (review prior year audit files warehouses issues)

A

Review prior year audit files to identify whether any warehouse experienced significant issues in the prior year

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4
Q

Inventory (Discuss new inventory changes regarding items)

A

Discuss with management whether any warehouses are new, significant changes have occured with regards to inventory items

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5
Q

Inventory (Obtain inventory instructions review deficiencies)

A

Obtain copy of proposed inventory instructions, review them for control deficiencies and dsicuss with management

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6
Q

Inventory (Discuss third-party warehouse omitted)

A

Discuss with management whether third-party inventory is stored at warehouse and whether it is omitted from the accounts

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7
Q

Inventory (Observe teams procedures)

A

Observe counting teams and company to confirm whether procedures are being follwoed

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8
Q

Inventory (Sample test sheets physical vice)

A

Perform sample test counts from inventory sheets to physical inventory and vice versa

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9
Q

Inventory (Observe movements inventory confirming ceased)

A

Observe procedures for movements of inventory during counts, confirming all movements have ceased

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10
Q

Inventory (Obtain sequentially inventory sheets testing audit)

A

Obtain copy of sequentially numbered inventory sheets for follow up testing at final audit

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11
Q

Inventory (Obtain GRNs and GDNs)

A

Obtain GRNs and GDNs fro current year and next year for cut-offs

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12
Q

Share capital (Review minutes additional shares issue)

A

Review board minutes to confirm number of additional shares issued and the issue price

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13
Q

Share capital (Review documentation confirm details issue)

A

Review legal documentation and correspndonce to confirm details of the share issue

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14
Q

Share capital (Compare issue register)

A

Compare the issue of new shares to the share register

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15
Q

Share capital (Inspect ledger account statement cash received issue)

A

Inspect bank ledger account and statements for evidence of cash received from share issue

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16
Q

Share capital (recalculate proceeds nominal and recording capital premium)

A

Recalculate proceeds of nominal value of shares and share premiums ensure correct recording within share capital and share premium

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17
Q

Share capital (review disclosure issue FS compliance IFRS)

A

Review disclosure of share issue in FSs to ensure compliance with IFRS

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18
Q

Land and buildings (obtain schedule land cast and agree)

A

Obtain schedule of all land buildings, cast and agree to FSs

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19
Q

Land and buildings (Assess professional body valuer)

A

Assess capability of valuer through enquiry their qualifications and experience valuing these assets

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20
Q

Land and buildings (Review methods revaluation compliance IAS)

A

Review method adopted by valuer used in revaluation, ensure compliance with IAS 16

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21
Q

Land and buildings (Agree schedule revalued asset statement non-current register)

A

Agree schedule of revalued land and buildings to valuation statement provided by valuer and the non-current assets register

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22
Q

Land and buildings (Recalculation revaluation adjustment correctly surplus)

A

Recalculate total revaluation adjustment and agree correctly recorded in revalaution surplus

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23
Q

Land and buildings (Recalculation depreciation confirm asset cost revaluation pro-rata)

A

Recalculate depreciation charge and confirm that assets revaled, depreciation was based on cost before revaluation and based after revaluation on pro-rata basis

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24
Q

Land and buildings (Sample land physically existence)

A

For a sample of land and buildings, physically confirm the existence

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25
Q

Land and buildings (Review FS disclosures compliance)

A

Review FS disclosures relating to land and buildings to ensure comply with IAS 16

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26
Q

Inventory (Breakdown cost calculation unit discuss management standard derived)

A

Request breakdown of cost calculation of each unit of this product and discuss with management how standard cost was derived

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27
Q

Inventory (Compare actual to budget sales unit discuss lower management)

A

Compare actual sales units per month to budgeted sales per month to establish how much lower actual sales are expected and discuss with management

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28
Q

Inventory (Select inventory review sales invoice NRV required above adjustment required)

A

Select sample of items included in inventory and review year-end sales invoices to ascertain if NRV is above cost or if adjustment required

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29
Q

Vehcile additions (Inspect sample confirm registration register)

A

Inspect a sample of additions, confirming that registration number on vehicle agrees to NCA register

30
Q

Vehcile additions (Review depreciation rates carrying amount overstated)

A

Review depreciation rates on existing vehicles to establish carrying amount of other vehicles are overstated

31
Q

Vehcile additions (Discuss management history replacement determining useful life)

A

Discuss with management company’s history of vehicle replacement, determining if vehicles are being used for their entire useful life

32
Q

Inventory (discuss WIP valuation reasonableness)

A

Discuss basis of WIP valuation with management and assess reasonableness

33
Q

Inventory (review inventory reports identify goods allowance)

A

Review aged inventory reports and identify any slow-moving goods, discuss with management if an allowance is required

34
Q

Inventory (defective review board discuss plans selling goods)

A

For defective batch, review board minutes and discuss with management their plans for selling these goods

35
Q

Inventory (examine post-year credit returns write down required)

A

Examine post-year-end credit notes to determine whether returns could signify that a write down is required

36
Q

Inventory (confirm adjustment damaged confirm made

A

Confirm amonut of final adjustment for damaged product and confirm if such adjustment is made

37
Q

Damaged PPE (review condition confirm damaged identified)

A

Review condition of other PPE to confirm all damaged assets identified

38
Q

Damaged PPE (review assets discuss management amount scrap)

A

Review the damaged assets and discuss with management the amount of scrap value assessment

39
Q

Damaged PPE (discuss management claim insurance)

A

Discuss with management whether they can claim on insurance

40
Q

Damaged PPE (discuss non-adjusting FS)

A

Discuss with management whether they will disclose a non-adjusting event in FSs

41
Q

Depreciation (discuss rationale PPE depreciation lives values)

A

Discuss with management rationale for changes in PPE depreciation rates, useful lives, residual values and how these were arrived at

42
Q

Depreciation (confirm reasonableness depreciation average)

A

Confirm reasonableness of such changes by comparing depreciation rates to sector average

43
Q

Depreciation (review expenditure budgets few revised lives correspond planned)

A

Review asset expenditure budgets for next few years to assess revised asset lives correspond with planned period

44
Q

Depreciation (review register depreciation rates applied)

A

Review non-current asset register if revised depreciation rates are applied

45
Q

Depreciation (obtain breakdown NCA discuss management reasonable)

A

Obtain breakdown of non-current assets, compare to prior years and discuss with management whether such change is reasonable

46
Q

Depreciation (review disclosure depreciation FSs complaince)

A

Review disclosure of depreciation and polciies in draft FSs and ensure compliance with IAS 16

47
Q

Depreciation (perform calculation depreciation discuss management)

A

Perform proof-in-total calculation on depreciation charged to PPE, discuss with management if there are significant fluctuations

48
Q

Rights Issue (Review munutes amount issue)

A

Review board minutes to confirm amount of finance to be raised via rights issue

49
Q

Rights Issue (Inspect statements confirm amount rights)

A

Inspect bank statements to confirm amount received from rights issue

50
Q

Rights Issue (Recalculate split share FS)

A

Recalculate split of share capital and share premium and agree to FSs

51
Q

Rights Issue (Review FSs disclosure compliance standards)

A

Review FS disclosure to confirm compliance with accounting standards

52
Q

Supplier statement recs (Sample year-end statements balance individual supplier)

A

Select a representative sample of year-end supplier statements and agree balance to list of individual supplier balances, investigate any reconciling items

53
Q

Supplier statement recs (Difference invoices in transit GRN pre-year-end accrual)

A

If differences occur due to invoices in transit, confirm from GRN whether receipt of goods was pre-year-end, if it is include in an accrual

54
Q

Supplier statement recs (Difference cash transit company supplier confirm ledger statement pre-year-end)

A

Where difference occurs due to cash in transit from company to supplier, confirm from bank ledger and bank statements that cash was sent pre-year-end

55
Q

Supplier statement recs (Discuss further items payables reconciling item)

A

Discuss further adjusting items with payables ledger supervisor to understand nature of reconciling item

56
Q

Test accuracy for inventory?

A

Review internal auditors report of inventory count to identify level of adjustments

Perform test counts and compare these to first inventory records

57
Q

What assertion is made when receivables are overstated as the balance from this customer does not appear to be recoverable?

A

Valuation

58
Q

Evidence of completeness for receivables?

A

Matching total of aged receivables listing to sales ledger control account

59
Q

Example of completeness of inventory?

A

GRNs are not sequentially numbered means inventory could be understated

60
Q

Share capital (Agree share capital statutory)

A

Agree authorised share capital with statutory documents

61
Q

Share capital (Agree share capital authorised resolutions)

A

Aghree changes to authorised share capital with properly authorised resolutions

62
Q

Issue of shares (verify issue share minutes)

A

Verify issue of share capital with board minutes

63
Q

Issue of shares (confirm cash received share capital not paid)

A

Confirm cash has been received as called share capital not paid

64
Q

Transfer of shares (review balances total list share capital ledger)

A

Review balances on shareholders’ accounts and total list with amount of issued share capital in general ledger

65
Q

Dviidends (agree dividend payments documentary)

A

Agree dividend payments to documentary evidence

66
Q

Dividends (test dividends contravene provision reviewing legislation)

A

Test dividends do not contravene distributing provision by reviewing the legislation

67
Q

Reserve (agree movements authority)

A

Agree movements on reserves to supporting authority

68
Q

Reserve (confirm company distinuguish reserves)

A

Confirm company can distinguish distributable reserves from non-distributable reserves

69
Q

Reserve (ensure disclosures movements reserves inspection FSs)

A

Ensure appropriate disclosures of movements on reserves are made in company’s account by inspection of FSs

70
Q

IAS 10 adjustment (correspondence customer reviewed payment)

A

Correspondence with customer should be reviewed to assess whether likelihood of payment

71
Q

IAS 10 adjustment (review board understand adjustment)

A

Discuss with management and review board minutes to udnerstand the type of adjustment required

72
Q

IAS 10 adjustment (post bank ledger book statements received customer)

A

Review post-year-end bank ledger/cash book and bank statements to see if payments received from the customer

AA Question Rote (27 decks)

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