What is the auditor’s role with respect to the fixed asset system?

Q: Define asset classifications.

A: Assets: Assets are the resources owned by the business, and used to earn its current and future…

Q: What is asset and liability management?

A: The process of ALM (Asset and liability management) is the process used to manage financial risks…

Q: Why is it important that auditors familiarize themselves with the acquisition and expenditure Cycle

A: Auditing means the inspection of financial accounts of the company to determine if the records are…

Q: What are specific audit objectives?  Explain their relationship to the general audit objectives.…

A: The application of the general audit objectives to a given class of transactions, account balance,…

Q: In performing risk assessment procedures for property, plant and equipment, an auditor may inquire…

A: Firstly let us understand what are risk assessment procedures. Risk assessment is the assessment of…

Q: Define Asset turnover.

A: Ratio analysis  It is the financial analysis tool for measuring the profitability, liquidity,…

Q: calculate asset turnover

A: since the numeric data is not provided I am explaining just a concept of Asset turnover ratio.

Q: discuss the process of auditing the following transactions/accounts: • Revenue Recognition •…

A: The audit definition or notion may be described as the validation of particular accounting…

Q: How can auditors gain assurance about fair value estimates in the investment cycle?

A: While assuring about the fair value estimates in the investment cycle, an auditor's foremost task is…

Q: define current asset and explain the particularity of an operating cycle

A: Solution:- a)Explanation of current assets as follows:- 1)Definition:- Current assets means assets…

Q: c) Exhibit a table of the Management Assertions and Balance Related Audit Objectives applied to non…

A: Management Assertion in Auditing In a simple term auditor might use some technique to ascertain the…

Q: Assess the standard deviation factor's significance in comparing assets critically.

A: This question explains about assess the standard deviation factor's significance in comparing assets…

Q: What are the different risks associated in the accounting of inventories?

A: Answer: Inventories are the current assets of the company which are realizable within 12 months from…

Q: What is the primary purpose of analyzing interest expense? Giventhis purpose, what primary…

A: Interest: Interest is the amount of interest paid on the issue price of the notes by the issuer at…

Q: How do you identify an asset with reference to AASB?

A: Balance sheet: A balance sheet is a statement of assets, liability, and equity. It is prepared after…

Q: Discuss and give examples of some of the indicators that affect asset classes

A: Asset classes:- An asset class is basically a collection of investments with some comparable…

Q: Discuss the risk of material misstatement inthe acquisition and expenditure cycle.

A: Material Misstatement refers to the misleading information in the statement of affairs of the…

Q: What functions should be separated to segregaterecord keeping from asset custody?

A: Assets: Assets are those items that provide value for money and future economic benefit for an…

Q: Define asset impairments.

A: Property, Plant, and Equipment:   Property, Plant, and Equipment refers to the fixed assets, having…

Q: How should an auditor test for proper authorization in the expenditure cycle?

A:

Q: What was the acquisition cost of the equipment?

A: Given the salvage value = 15000 Useful life = 10 years Depreciation for 4th year = 63636 If the…

Q: Whose property are audit documentation (audit workpapers)? In what form must they be?

A: Auditing:                   It is a systematic verification of the books of accounts of an…

Q: How is the directional risk of investments applied in determining the appropriate audit procedures…

A: Answer: The directional risk of investment is the risk of overstatement of the investments.

Q: How do fixed asset systems differ from purchases systems?

A: Definition: Purchase system: The identification and procurement of the inventory needs for the…

Q: When an auditor reviews additions to the equipment (fixed asset) account to make sure that fixed…

A:

Q: What are the benefits of adopting a Condition Base Monitoring (PredictiveMaintenance) in the…

A: A condition monitoring system is a critical component of AM and reliability. CMS scope typically…

Q: Find the "Asset turnover"!

A: Calculate the asset turnover ratio as follows: Asset turnover ratio = Net sales / Average total…

Q: Consider the risks typically associated with tangible long-lived assets and identifythe internal…

A: Internal controls are the controls that are implemented to ensure the integrity and objectivity in…

Q: Discuss the overarching idea of Asset Liability Management and its key objectives. How does the…

A: Asset and liability management practices were first introduced by financial institutions during the…

Q: In performing substantive procedures for a review of Rental Revenue from Land, Buildings, and…

A: Substantive procedures are those tasks that the auditor conducts to diagnose material…

Q: What are the major differences between the audit of prepaid expensesand other asset accounts such as…

A: Given: The difference between the prepaid expenses audits and the other assets accounts.

Q: How is the directional risk of inventories applied in determining the appropriate audit procedures…

A: Answer: During the audit of any balance sheet items, proper audit procedures are to be gathered to…

Q: What is the condition of security? Has it been reasonably well maintained or does it show the…

A: Security is a financial instrument, either equity or debt, which has some legal values. Securities…

Q: Which of the following is not a scope of internal auditors? Efficient Use of Resources Should work…

A: Internal auditors are the professionals appointed by the businesses to ensure the operational…

Q: What serious consequences occur in an inaccurate estimate of asset needs?

A: Estimates of assets:   It is approximate value of assets of original value of assets which is used…

Q: What procedures are involved in the conduct of a turnaround program?

A: The term "turnaround management program" refers to the restructuring and renewal of a company. When…

Q: Which department performs the formal record- keeping function for fixed assets?

A: Definition: Fixed Assets: It refers to the long-term assets having a useful life of more than a year…

Q: Distinguish between physical asset markets and financial asset markets.

A: Physical Asset markets are markets where buyers and sellers transact in tangible goods which can be…

Q: 12. When auditing' intangible assets, the auditor would likely recomputed amortization and determine…

A: Recomputation of amortization and assessing management's recorded amount is reasonable is performing…

Q: What is the objective in identifying the costs of an asset?

A: Asset:   It represents the tangible and intangible resources owned by the business for a particular…

Q: Evaluate the standard deviation factor's significance in comparing assets critically.

A: Answer: Concept: Standard deviation is the concept that helps us to analyze volatile market for…

Audit Procedures

Audit Procedures are methods and techniques performed by the auditor to determine the quality of financial information of clients, thereby expressing an opinion on true & fair view of financial statements and entity position. They are identified and applied at the planning stage of audit after determining audit objectives, scope, approach, and risk assessment.