Principles Of Auditing & Other Assurance Services
Principles Of Auditing & Other Assurance Services
21st Edition
ISBN: 9781259916984
Author: WHITTINGTON, Ray, Pany, Kurt
Publisher: Mcgraw-hill Education,
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Chapter 4, Problem 40P
To determine

Discuss the legal problems that can arise against C and Company under the present case.

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Hall accepted an engagement to audit the year 1 financial statements of XYZ Company. XYZcompleted the preparation of the year 1 financial statements on February 13, year 2, and itsauditors began the fieldwork on February 17, year 2. Hall completed gathering sufficientappropriate evidence on March 24, year 2; Hall’s report and XYZ’s financial statements werereleased on March 28, year 2. The written representations normally would be dateda. February 13, year 2.b. February 17, year 2.c. March 24, year 2.d. March 28, year 2.
Consider the following material and independent situations (i) to (iii) below.In each situation, the following dates apply:• Balance date: 30 June 2021• Date of audit report: 16 August 2021• Audited financial report and audit report sent to shareholders: 23 August 2021• Annual general meeting: 30 September 2021(i) The client purchased raw materials that were received before the financial year end. The purchase was recorded based on its estimated value. The supplier’s invoice, received on 30 July 2021, showed that the cost was substantially different from the estimated value.(ii) On 10 August 2021, the directors signed a contract to upgrade the client’s airconditioning system. The first payment of $100,000 is due on 1 September 2021. Work will be completed by 30 June 2022, and the final contract payment will be made at that time.(iii) On 25 August 2021, the general manager informed you that on 18 August 2021 the directors decided to sell land that the client was holding as a long-term…
It is 1 July 20X5. You are an audit manager in Welford & Co, a firm of Chartered Certified Accountants. Your role includes performing post-issuance audit quality reviews, and you have been asked to review the audit work performed on Rivers Co for the financial year ended 31 January 20X5. You have gathered the following information from your review of the audit file: Audit team and feesRivers Co is a listed company operating in the construction industry. The company complies with corporate governance regulations and has an audit committee. Rivers Co has been an audit client of Welford & Co for eight years, and Bob Newbold has been the audit engagement partner during this time. Rivers Co’s auditor’s report was signed by Bob Newbold and issued last week. The report contained an unmodified opinion. Welford & Co requires its staff to record each hour they spend working on each client in the firm’s time management system. From reviewing the time records relating to the audit of…
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