Auditing Financial Statements And Reports -Myassignmenthelp.Com

Question: Discuss About The Auditing Financial Statements And Reports? Answer: Introduction The Canadian Auditing Standard (CAS) considers the responsibilities of the independent auditors while conducting the audit of the financial statements which are as per the guidelines prescribed with CAS. It sets out the objectives to the independent accounting and also explains the scope and nature of the audit designed for the independent auditors to adhere to those objectives. This has also evaluated the overall structure of the authority and the scope of the CAS which takes into account the general responsibilities of the independent auditors which is compliant to CASs. The CAS was introduced in September 2012 and Paragraph C20A clarified with the authority of the assurance associated to the related services guidelines are relevant to the appropriate engagement. The Paragraph C20 is depicted to be effective for the financial statements generated periods ending on or after September 1, 2012 (Frascanada.ca. 2018). As per the given case Jarvis Co., Chartered Professional Accountants is seen to violate many rules of the professional conduct. The Rule 217.1 is seen to prohibit advertising in a way which is false or misleading in nature. In addition to this, Rule 217.1 contravenes professional good taste and often provides unfavourable reflections on the other Chartered Accountants or generates unsubstantial statements (Etchell et al. 2018). The CAs poor performance is evident with advertising that the accountants deliver superior work. The Rule 214 restricts the firm to quote a fee before the information is procured before the engagement. In such cases, the firm guarantees a fixed fee from the client and is not considering the scope of their work (Moroney and Trotman 2016). The depictions made in the given situation clearly illustrates that during the inventory test there had been several incidences of overstatement pertaining to the pricing errors along with the combination of the errors which were immaterial in nature. Based on CAS 210 paragraph 6 the auditor is required to prepare financial statements which are free from material misstatements due to fraud and error. In addition to this, the section 5110 under CAS 210, requires the submission of a written agreement along with the limitations in which CAS 210 does not contain any similar explanatory material (as per paragraph 23 of CAS 210) (Favere-Marchesi and Emby 2017). The violation of the auditing practicing based on CAS 210 paragraph 6 and CAS 210 paragraph 23 is considered to be evident in form of the overstatement due to the errors pertaining to obsolescence and combination of errors which were considered to be immaterial in nature. Furthermore, there was no attempt to document the controls or test those controls. This shows significant areas of violation of other CAS standards (Moroney 2015). Audit Procedure Assertion Type of audit evidence Quality of audit evidence (high, moderate, or low) and WHY #1 Theain assertion is associated to ensure total managerial payroll is up to date. This will confirm the actual expense incurred is matched with the estimated payroll. Some of the other changes in the ledger accounts would include accuracy in gross wages, salaries, payroll taxes and accrued payroll expenses This type of audit evidence is known as reperformance. High- The following procedure involves the auditors independent testing of clients accounting procedures which were originally done as a part of internal control system and entitys accounting. This also involves re-calculation of performance with other procedures, thereby ensuring high quality of accuracy and audit evidence. That assertions based on sample of equipment listed on capital asset master files will confirm that the company is able to estimate the expected useful life of the equipment precisely. Henceforth, the main ledger account impact will be observed in property plant and equipm The audit evidence is identified as physical examination. Moderate- The following audit evidence is considered to be moderate in nature as the auditor is physically verifying the condition of equipment listed on capital asset master files. Despite of an overall verification of the physical equipment, the impact of external factors such as declining market value of assets, changes in technological aspects, legal or economic environment of the operating entity cannot be determined along with considerations for impairment. Henceforth, this acts as a moderate audit evidence (Deloitte Nigeria 2018). #3 The discussion with management on the payroll liabilities which might occur in the prior years financial statements will have a significant impact on the payroll provided by the company along with changes in liabilities. The ledger account impact is discerned with total liabilities. The following audit procedure is identified as inquiries of the client Low- This particular evidence is gathered by taking either written or oral information from the client in response of the questions made by the auditor. The dependence on such type of evidence is not reliable as these are not conclusive in nature. Additionally, the auditor need to depend on other procedures for further analysis on a particular matter (In.kpmg.com 2018). References Deloitte Nigeria. (2018).Audit Readiness (4) - Property, Plant and Equipment. [online] Available at: https://www2.deloitte.com/ng/en/pages/audit/articles/financial-reporting/audit-readiness-4-property-plant-and-equipment.html [Accessed 6 Feb. 2018]. Etchells, M., Spradbrow, J., Cohen, R., Lin, Y., Armali, C., Lieberman, L., Cserti?Gazdewich, C., Pendergrast, J. and Callum, J., 2018. Audit of appropriate use of platelet transfusions: validation of adjudication criteria.Vox sanguinis,113(1), pp.40-50. Favere-Marchesi, M. and Emby, C.E., 2017. The Alumni Effect Professional Skepticism: An Experimental Investigation. Accounting Horizons. Frascanada.ca. (2018). [online] Available at: https://www.frascanada.ca/canadian-auditing-standards/resources/reference-material/item31008.pdf [Accessed 6 Feb. 2018]. In.kpmg.com. (2018). [online] Available at: https://in.kpmg.com/knowledge_update/Guidance-Note-Audit.pdf [Accessed 6 Feb. 2018]. Lieberman, L., Lin, Y., Cserti?Gazdewich, C., Yi, Q.L., Pendergrast, J., Lau, W. and Callum, J., 2017. Utilization of frozen plasma, cryoprecipitate, and recombinant factor VIIa for children with hemostatic impairments: An audit of transfusion appropriateness.Pediatric blood cancer. Moroney, R. and Trotman, K.T., 2016. Differences in Auditors' Materiality Assessments When Auditing Financial Statements and Sustainability Reports. Contemporary Accounting Research, 33(2), pp.551-575. Moroney, R., 2015. Auditing: A Practical Approach. Wiley Global Education.