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ACC305 Auditing and Accounting Assignment Help
Audi is the procedure which is used by the auditors in order to detect the problems and other discrepancies in the business functioning of the organization. It is accompanied with several activities such as documentation, direction, supervision, and review of financial statement and invoices. In ACC305 Auditing and Accounting Assignment Help, several case studies are taken into consideration to identify audit problems while preparing audit plan in determined approach. There are various internal and external factors which should be kept in the mind by the auditor while performing audits functioning. There are other factors such as economical changes, political changes, social perception of clients which provides that auditor has to consider all this values in order to prepare effective audit plan. Moreover there are several points have been discussed in this report which depicts the true advantage of audit procedure andaccounting functioning
Case study 1 Identification of the audit planning issues in planning documents
There is several case studies have been given regarding the working condition of independent business situation. However, different audit plans have been developed regard with the different case studies. These case studies are helpful to understanding the analytical factors of the audit process and how these accounting issues are dealt by auditors for the better preparation of the audit plan. However, this case study helps in generation of effective audit plan for the betterment of internal control system.
Audit is comprised of set of plans which are implemented in order to check the true and complete fairness of the financial statement of the organization in determined approach. In order to make effective use of audit resources auditor needs to evaluate all the present and future factors.
In this case study it is found that City Ltd, a property developer, has a several major projects in progress in Brisbane’s central business district. This company has been providing its services effectively in real estate business. But the fact in this case study is that due to high amount of cash inflow and cash outflow it is observed that audit plan should be more tight and strict to detect the associated problems. The audit planning issue there are following audits issues have been addressed that management department of the organization is not cooperative with the auditors. All the details and invoices prepared by City Ltd are not as per the compliance with ISA300. In addition to this as per the requirement of IFRA rules and laws read with accordance with ISA 300 auditors are facing problems in plan the nature, timing, and extent of direction for preparing management of audit plan. This Rules and regulation are the prime concern for the completion of proper recording keeping of the data of City Ltd business. Company working on international level not only has to comply with the domestic laws but also laws of reporting countries in which consolidated financial statement is prepared.
In ACC305 Auditing and Accounting Assignment Help it is observed that Web Ltd is purchasing new system. Being an auditor of that company there are several issues could be taken into consideration such as whether Web Ltd has license to implement new system in its reporting, price charged by other supplier is in limit or not. Moreover all the invoices and receipt prepared by the Web Ltd whether prepared as per the legal compliance or not. There are various other facts such as applicability of new system, sources of money to buy such system, compliance with required rules and regulation in determined ways.
- Here being a auditor of Beauty Pvt. Ltd it is found that company has been transferring its cosmetic products to its oversea branch. Being Auditor it would be checked that whether company has been transferring its cosmetic goods at arm length price. Moreover the cost of production will also become hurdles while calculating total cost.
In this case study it is given that Car fleet leasing company Vroom Ltd has been running its business in the car lease business. It is also observed that company has high amount of customers. This company provides cars to its clients at lease. Being an auditor there are two types of audit procedure is involved test procedure and substantive procedure for the betterment of audit planning.
- What are the general issues related to deciding whether to use a test of controls approach or a substantive approach?
Testing approach-This audit approach is used when there are fewer problems and fewer discrepancies in the business functioning.
There are following general issues which is to be faced in the audit plan of the organization is related with how test control and substantive control is implemented in internal control system. There are following general issues which are used in audit functioning such as internal control system, complexity of the organization, functioning, control risk assessment and further more. There for Vroom Ltd has been providing cars to its clients on lease which is accompanied with a cumbersome process such as creation of charge, index list of assets on finance. This results into application of substantive approach in determined approach. On the other hand testing approach is used when there is less complexity in the business functioning of the Vroom Ltd.
This both related with different approach depending upon all the risk management and internal functioning factors in determined ways.
- How do the risk assessments above relate to the choice of audit approach?
Risk assessments- This is the procedure to evaluate risks of all the process system in determined approach so that malfunctioning and wrong working system could be overcome in effective manner. It is related with risk control, risk management and other activities in system process.
Inherent risk- It is the risk which is occurred due to omission or error in financial statement of the vroom Ltd. Ideally this risk in the business functioning of the Vroom Ltd is occurred due to negligent behavior of the employees in the internal control audit.
Control risk– This risk arises due to malfunctioning in the internal control system of the organization. However, this risk arises when employees engaged in the internal control system do not work accordingly as per the determined approach (Audit, 2010).
Detention risk- It is the risk of auditor that he will be unable to capture the discrepancies in the business functioning of the organization. This risk is occurred to be high in nature and hard to detect as it is the result of minor mistakes in the process system of Vroom ltd.
All the related risks help organization to manage work and preparation of audit plan as per the disclosed risks such as inherent risk, detention risk and other risks.
If Vroom Ltd has high detention risk then there is need to adopt Substantive audit approach.
If Vroom Ltd has high medium inherent risk, control risk and less detention risk then testing auditor approach will be implemented.
This risks is dependent upon the employees efficiency, auditor working quality and other factors in significantly way.
- If you adopted the approach set out in the planning summary, what audit procedures would you use for the accuracy and completeness of depreciation expense?
If adopted approach in the planned summary is set out then there will be following audit procedures for the increment of the accuracy and completeness of depreciation expenses
Auditor will need to check whether deprecation on the cars is based on the written down value or not as this approach depicts the true value of the cars.
There should be proper annexure of the amount charged and closing and opening amount of the assets of the cars.
Auditor will check the accuracy of the amount charged on the assets of Vroom Ltd to make its internal control system effective.
Now in the end it would be observed that audit procedure is comprised of finding facts and figure, collection of required documents to manage invoices, and determining true and fairness of the financial statement. (Audit, 2015)
Case study 3
Connectionbetween auditing and the communication of accounting information- In this case study it is being given that Jim strong audit assistant is unsure about the nexus between attributes of financial statement and audit functioning. There in order to make him familiar with the auditing and accounting complete study has been prepared as below.
Auditing: Auditing means checking of books of accounts and financial statements of an organization. Auditing is done with a view to inspect the financial statement of an organization with a view to determine the correctness of those statements.
Accounting: Accounting means maintaining the books of accounts of an organization in systematic manner so that the financial statements of that organization can be prepared from the books of accounts in the end of financial year.
Connection between auditing and accounting is related with how to make effective use of resources in determined approach.
In this Jim needs to understand the required factors of the auditing and accounting for the better understanding the relation between audit and accounting. However there is given a table to establish a clear relation between auditing and accounting as below.
Analysis: This is related with establishment of set of activities in determined approach for defining true and fairness of the financial statement. However auditor needs to understand how to draw valid conclusion out of the financial statement of the organization. Moreover, financial statement prepared by the organization should be based upon true facts and invoices for the betterment of the results.
Communication of accounting information:
Accounting information of the organization is related with using financial statement such as P&L, Balance sheet and other cash flow statement in determined approach. This information is very much useful for computing the right amount of depreciation and deciding cash flow statement in efficient ways.
Establish a clear relation between auditing and accounting
Accounting means systematically keeping the records and accounts of an organization and preparation of financial statement of the organization. In simple words related with recording, storing, collecting all the financial data for depicting the true value of the organization in significant way.
Audit is related with inspection of books of account and financial statements of organizations. Audit procedure is related with establishment of true and fairness of financial statement.
Accounting is governed and regulated by the rules and regulation passed by IFRA.
There is separate accounting standard for inspection of books of account.
It depicts the performance, financial position and profitability of the organization.
It reveals the malfunctioning in the business process system of the organization.
It is started where book keeping ends
Auditing starts where accounting ends
It is consistent activity which is related with continues process of recording and keeping of transaction.
It is periodical process which is done to keep the check over the accounting system of the organization.
This above table depicts that auditing and accounting run side by side for the better functioning of the organizations. When at the separate palace accounting relates with keeping records of transaction and auditing the next procedure which helps in reducing control, detention and inherent risk in the business functioning of the organization (Audit: Abstracts", 2015).
In ACC305 Auditing and Accounting Assignment Help various positive and negative factors have been identified in determined approach. Audit procedure is comprised of several set of activities such as creation of audit plan and determining of set plans and procedure or mitigation of all risk control risk, and detention risk. All the risks which are related with the financial statement of the organization depend upon the internal and statutory audit functioning of the organization. Now in the end it would be said that audit plan is very much effective for managing business functioning in determined approach.
"Audit", 2010, International Journal of Stroke, vol. 5, no. 3_suppl, pp. 18-21
"Audit", 2010, International Journal of Stroke, vol. 5, no. 3_suppl, pp. 18-21.
"Audit", 2014, International Journal of Stroke, vol. 9, no. 4_suppl, pp. 36-37.
"Audit", 2015, International Journal of Stroke, vol. 10, no. 5_suppl, pp. 70-70.
Audit: Abstracts", 2015, International Journal of Stroke, vol. 10, pp. 70-70.
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