未知题型 (a) The IAASB has conducted a review of the structure and content of audit reports, including the issuance of an Invitation to Comment on Improving the Auditor’s Report, in which several suggestions were made with the aim of improving the disclosure of matters included in the auditor’s report, including those relating to going concern status.Required:Explain the suggestions made by the IAASB in respect of additional disclosures in the auditor’s report regarding going concern status, and discuss the benefits of such disclosures. (8 marks)(b) You are an audit manager in Taylor & Co, a firm of Chartered Certified Accountants, responsible for the audit of Marr Co, with a year ended 28 February 2014. The draft financial statements recognise profit for the year of $11 million. The audit for the year end is nearing completion, and several matters have been highlighted for your attention by the audit senior, Xi Smith. The matters have been discussed with management and will not be adjusted in the financial statements:1. In January 2014 a major customer went into administration. There was a balance of $2·5 million owing to Marr Co from this customer at 28 February 2014, which is still included in trade receivables.2. A court case began in December 2013 involving an ex-employee who is suing Marr Co for unfair dismissal. Lawyers estimate that damages of $50,000 are probable to be paid. The financial statements include a note describing the court case and quantifying the potential damages but no adjustment has been made to include it in the statement of financial position or the statement of profit or loss.Xi Smith has produced a draft audit report for your review, an extract of which is shown below:Basis for opinion and disclaimer of opinionWe have performed our audit based on a materiality level of $1·5 million. Our audit procedures have proven conclusively that trade receivables are materially misstated. The finance director of Marr Co, Rita Gilmour, has refused to make an adjustment to write off a significant trade receivables balance. Therefore in our opinion the financial statements of Marr Co are materially misstated and we therefore express a disclaimer of opinion because we do not think they are fairly presented.Emphasis of Matter paragraphMarr Co is facing a legal claim for an amount of $50,000 from an ex-employee. In our opinion this amount should be recognised as a provision but it is not included in the statement of financial position. We draw your attention to this breach of the relevant IFRS.Required:Critically appraise the proposed auditor’s report of Marr Co for the year ended 28 February 2014. Note: You are NOT required to re-draft the extracts from the auditor’s report. (12 marks)

未知题型 Section B – TWO questions ONLY to be attempted(a) You are an audit manager in Rose & Co, responsible for the audit of Cooper Co. You are reviewing the audit working papers relating to the financial year ended 31 January 2014. Cooper Co is a manufacturer of chemicals used in the agricultural industry. The draft financial statements recognise profit for the year to 31 January 2014 of $15 million (2013 – $20 million) and total assets of $240 million (2013 – $230 million).The audit senior, Max Turner, has brought several matters to your attention:(i) Cooper Co’s factories are recognised within property, plant and equipment at a carrying value of $60 million. Half of the factories produce a chemical which is used in farm animal feed. Recently the government has introduced a regulation stipulating that the chemical is phased out over the next three years. Sales of the chemical are still buoyant, however, and are projected to account for 45% of Cooper Co’s revenue for the year ending 31 January 2015. Cooper Co has started to research a replacement chemical which is allowed under the new regulation, and has spent $1 million on a feasibility study into the development of this chemical. (8 marks)(ii) In October 2013, Cooper Co’s finance director, Hannah Osbourne, purchased a car from the company. The carrying value of the car at the date of its disposal to Hannah was $50,000, and its market value was $75,000. Cooper Co raised an invoice for $50,000 in respect of the disposal, which is still outstanding for payment. (7 marks)Required:Comment on the matters to be considered and explain the audit evidence you should expect to find during your review of the audit working papers in respect of each of the issues described above.Note: The split of the mark allocation is shown against each of the issues above.(b) Max noticed that a section of the audit file had not been completed on the previous year’s audit. The incomplete section relates to expenditure incurred in the year to 31 January 2013, which appears not to have been audited at all in the prior year. The expenditure of $1·2 million was incurred in the development of an internally generated brand name. The amount was capitalised as an intangible asset at 31 January 2013, and that amount is still recognised at 31 January 2014.Required:Explain the implications of this matter for the completion of the audit, and any other professional issues raised, recommending any actions to be taken by the auditor. (5 marks)

未知题型 首席审计官由()任命。