week ten

Question 1

what are the key assertion and sources for evidence for non-current assets?

Answer 1

assertions:
-existence
-valuation
-completeness
-rights and obligation

evidence:
-NCA register
-purchase invoice
-ownership deeds
-cash book, capital expenditure

Question 2

how would you carry out an audit test for noncurrent assets
?

Answer 2

-obtain the NCA register and verify them with the financial statement
-physically inspect the NCA from the sample of the register
-select a sample that is visible and verify them with the register.
-inspect the assets for physical impairment.
-from the valuation report, compare if the amounts stated are truthful.
-obtain a list of additions and for a sample agree to the suppliers invoice.
-for a sample of inoivdes included in the register, verify if ownership and registration details are under the clients name.
-obtain a breakdown of the disposals and verify if they haven’t been included in the register
-select a sample of disposals and agree to sale proceeds.
-recalculate profit/loss and agree to the P/L statement.
-review profit/loss of the disposals and agree to the deprivation value.
-recalculate profit and loss for a sample of assets.

Question 3

what are the key assertions/evidence for intangible non-current assets?

Answer 3

assertion:
-existence

evidence:
-invoices
-timesheets
-project plan
-project results
-licence agreements
-cashbook