Acct System

837 Words Oct 15th, 2012 4 Pages
AUDITING 300 Semester 2 2012 - ASSIGNMENT 1 (Due Date: 20th August 2012)
Please answer all three questions
Question 1: The following are independent situations:
(i) Bob is an audit assistant currently undertaking university studies. While auditing the books of Club Casino, he comes across certain financial information that he believes will assist him in completing one of his university assignments. He copies the information and uses it in his assignment, carefully removing all reference to Club Casino in order to preserve the client’s confidentiality.
(ii) Wendy has been the engagement partner on the Ace Limited audit for a number of years. Some time ago, Ace’s long-standing company secretary retired and Ace took six months to find a
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(ii) Getaway Pty. Limited is a long established firm which has been operating a boutique hotel in the Blue Mountains for over 20 years. During this time, it has adopted a conservative business strategy that has seen it produce adequate, though slightly unimpressive, results. A new CEO has been appointed to run the firm from 1 September 20X7. He has already released his plans for renovating the hotel, despite not officially serving as CEO yet. You have also heard him discuss the implementation of a new marketing strategy to boost occupancy rates.
Required:
For each of the above independent situations: (1) describe the overall impact on audit risk and provide your reasons for your answer, and (2) identify the specific component(s) of audit risk affected. (Total 7 Marks)
Marks breakdown:
(i) Correct description of overall impact on AR (1Mark). Providing correct reason(s) (2 Marks). Identification of specific component of AR effected (1 Mark)
(ii) Correct description of overall impact on AR (1Mark). Providing correct reason(s) (1 Marks). Identification of specific component of AR effected (1 Mark)

Question 3:
You are the audit senior on the audit of Harmony Pty Ltd, a large manufacturing company, for the year ended 30 June 20X7. It is now 25 August, 20X7 and you are reviewing the audit working papers prepared by the audit assistant, Susan Jones, and notice the following matters:
(a) Susan attended the stocktake on 30

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