ACCT20075 Audit Assurance Assignments Solution

ACCT20075 Audit Assurance Assignments Solution

ACCT20075 Audit Assurance Assignments Solution

Introduction

With ramified changes, auditors are playing the key role in the business success and transparent business functioning of organization. In this report, annual report of two companies named Qantas and Fortes cue have been taken into consideration. The auditor’s responsibilities and auditing and assurance marketing services have also been analyzed.

Answer to question no-1

Qantas is the company that deals in airlines; it is third oldest airlines in the world. The company was found in November 1920, and it begins its international passenger flight in May 1935. Qantas is in alliance with one world airline. The headquarters of Qantas is located at the Qantas centre in the bayside council suburb of mascot, Sydney, New South Wales. According to the resend report there are 26,150 employees working in the company. This shows that the company is dealing at a very big level (Clark, et al. 2017).

Fortes cue is the global leader in the iron ore industry in the world. The company was in 2003. The company have discovered and developed so many mines in the world that makes them one of the core global iron producer in the world. The main vision of the company is to become the safest, lowest cost in relation to the production and research, and the most profitable in the ore industry. The company is also supplying 17% of the seaborne in the country of china, and is expanding it into Japan, South Korea and India (Tepalagul, and Lin, 2015).

Answer to question no-2

In the Qantas, the financial statement of the company shows the increment in its revenue in 2017. The operating income of the company is been decrease by 12% since last one year. The company has raised total assets by 13% and total equity of the company by 16% since last one year (Yee, Sujan, James,. and Leung, 2017).By understanding the financial statement of the company we can see that the company has maintained employee oriented organizational culture. And see their interest as their own interest so they have invested a lot in the funds scheme of their employee. In the airlines industry, QANTAS financial statement has strengthen goodwill as its revenue is increasing very year with the good rate (Vangelisti, 2016).

The financial statement of the Fortes cue shows that the company is on the progress the income, revenue, net profit and the net income of the company is increasing year by year. The company vision is very much on the peak to be achieved as they are working very well in their field. The investment of the company is also increasing every year. In the ore industry the fortes cue is doing very well and there are chances that they become one of the top ore company in the ore and mining industry (Qantas Company, 2018).

Answer to question no-3

The substantive test are those that are performed by the auditor to find out if there are any material misstatement in the financial statement or not and if there are then they can perform the test to find the keen area where there are chances of material statement. There are basically two type of substantive test that are analytical procedures and the other one is test of details in case of Qantas. But the analytical procedures provide fewer details as compare to the test of details, so if the auditors find out that there are some of the areas where are more chances of material misstatement than instead of analytical procedure in Qantas (Barr-Pulliam, Brown-Liburd,. and Sanderson, 2017).The auditor prefers to do test of details as it will provide more details to the notes to account of company. The Fortes cue uses the test of control so that the chances of fraud may decrease, for this internal control of the company. It would also make the transparency of company strong and lower down the inherent and detention risk in Fortes cue by appointing more internal auditor. When the test of automatic control or the internal control of the Fortes cue is strengthen by undertaking the audit substantive test than the work of auditor is been decrease as they have to use less substantive test for testing the fraud in the company (Fortes cue, 2018).

Answer to question no-4

The auditor is the person who is authorized to review the financial statement of the company and give their opinion whether they are free from material misstatement. He auditor can only give their opinion and the guarantee as they are also bound by some of the limitations (Kowaleski, Mayhew,. and Tegeler, 2018).

Responsibility of the auditors

The responsibility of the auditors is to plan the audit of the company and to obtain the reasonable assurance that whether the financial statement that are provided by the company are free from material misstatement that are caused by fraud and error in the company. The auditor is also responsible for giving their opinion on the financial statement that is presented by the company (Chan, Chiu, and Vasarhelyi, 2018). They also have to follow the entire audit standard that is set up by the audit council.

Responsibility of the management

The responsibility of the management is too corporate with the auditor while the audit is going on. They have to provide the information that the auditors need about the financial statement. Sometimes the management is also responsible for answering the auditor if there are some of the questions that are put on by auditor on them. They are also responsible to work under the law, and make decision according to the convenience of the entire departments (Beardsley, Lassila, and Omer, 2017).

Conclusion

The substantive test are used in this report and auditors responsibility are undertaken to perform the audit functions to find out if there are any material misstatement in the financial statement or not. The crux of this work is that auditors are in the fiduciary position towards the stakeholders and they work in the best interest of the stakeholders.

References

1. Barr-Pulliam, D., Brown-Liburd, H.L. and Sanderson, K.A., 2017. The Effects of the Internal Control Opinion and Use of Audit Data Analytics on Perceptions of Audit Quality, Assurance, and Auditor Negligence.. 2(3) pp. 71-83.
2. Beardsley, E., Lassila, D. and Omer, T., 2017. How Do Audit Offices Respond to Audit Fee Pressure? Evidence of Increased Focus on Nonaudit Services and Their Impact on Audit Quality. . 2(3) pp. 271-283.
3. Chan, D.Y., Chiu, V. and Vasarhelyi, M.A. eds., 2018. Continuous Auditing: Theory and Application.3rd ed Australia: Emerald Publishing Limited.
4. Clark, C.H., Hurkmans, C.W., Kry, S.F., of Radiation, T.G.Q.A. and Group, T.C.T.H., 2017. The role of dosimetry audit in lung SBRT multi-centreclinical managementtrials. Physica Medica44,(2) pp.171-176.
5. Fortes cue, 2018 retrieved, Available at http://investor.fortescue.com/investors/?page=annual-reports,Accessed on 4th October 2018
6. Kowaleski, Z.T., Mayhew, B.W. and Tegeler, A.C., 2018. The Impact of Consulting Services on Audit Quality: An Experimental Approach. Journal of Accounting Research56(2), pp.673-711.
7. Qantas Company, 2018 retrieved, Available at http://investor.qantas.com/investors/?page=annual-reports, . Accessed on 4th October 2018
8. Tepalagul, N. and Lin, L., (2015). Auditor independence and audit quality: A literature review. Journal of Accounting, Auditing & Finance30(1), pp.101-121.
9. Vangelisti, A.L., (2016). On the importance of communication research. Communication Education65(4), pp.501-504.
10. Yee, C.S., Sujan, A., James, K. and Leung, J.K., 2017. Perceptions of Singaporean internal audit customers regarding the role and effectiveness of internal audit. Asian Journal of Business and Accounting1(2), pp.147-174.