Tesco Accounting Case Study

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Task 1
1- Explain the purpose and use of different accounting records. Briefly explain why it is needed and how it is used to record all the business transactions in an organisation like Tesco (PLC).
Accounting records can be defined as all the documentations involved in the preparation of financial statements and any other records which are relevant for financial review and audits. These documents are used to record the assets and liabilities, the invoices, etc....
The books of prime entry: There are also called daybook, and are books into which transactions are recorded first before they go into any other books. Examples of books of prime entries are: sales day book, purchase day book, sales return day book, purchase return day book, general
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Tesco is a big company managing large sums of money and more complex financial transactions. Its computerised accounting systems are compatible to its industry. An accounting system is effective to the extent that it is compatible with daily business needs, such as storing client information, creating invoices, keeping account of and tracking inventories. The nature of this system urges the all users to be well trained in order for the system to be beneficial for the company. Tesco’s employees on the ground have a good knowledge of the accounting system and it eases accounting and financial functions in the business. The nature of this system urges the all users to be well trained in order for the system to be beneficial for the company. Tesco’s accounting system has been well implemented as the system is functioning…show more content…
In this letter, management confirms that the all information contained within the company's financial statements is true and accurate and that all information has been disclosed. A letter of representation is important to confirm management’s responsibility, to support other audit evidence and when required by other ISAs. In this letter, management confirms that he has given the auditor all relevant information agreed upon and he acknowledges that financial statements have been collectively prepared and free from any bias. Letter of representation does not replace audit evidence, but support them. The fact that a consistent representation is provided does not mean audit evidence become meaningless. In case the letter is not in line with other audit evidence, the auditor shall perform audit procedures to try to resolve the

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