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ACC707 Auditing & Assurance Assignment

   

Added on  2020-05-16

6 Pages1131 Words61 Views
Running head: AUDITING AND ASSURANCEAuditing and AssuranceName of the Student:Name of the University:Author’s Note:Course ID:

1AUDITING AND ASSURANCETable of ContentsQuestion 3:.......................................................................................................................................2Answer to Part (a):.......................................................................................................................2Answer to Part (b):.......................................................................................................................3Answer to Part (c):.......................................................................................................................3References:......................................................................................................................................5

2AUDITING AND ASSURANCEQuestion 3:This section provides various independent situations, which the auditors often encounterin their day-to-day activities. The auditors are often required to issue qualified and unqualifiedaudit reports based on the financial information provided on the part of the organisations. Thus,this section would aim to evaluate three independent situations, in which the auditors are neededto provide their audit opinion along with explanation of the issued opinion. Answer to Part (a):Based on the provided case study, it could be stated that the Connor Company isencountering increased complexities to repay its debts during the past financial year. Theauditors have the primary responsibility of examining the financial statements of theorganisations, which would enable in assuring that the financial statements of such organisationsdo not contain material misstatements and they have been developed by adhering to the crucialregulations. However, the auditors are not allowed to make comments on the financial positionsof the organisations; in case, there are no frauds (Farooq et al. 2017). For Connor Company, itcould be observed that the organisation is reliant largely on bank overdraft in paying its loans,since no finance alternative is available to the organisation. Along with this, the bank needs repayment within a month. It depicts the poor financialposition of the Connor Company. However, this aspect has not developed any materiality effect.The auditor has not identified any material misstatement in any of the financial statements of theConnor Company. This signifies that the organisation is not involved in manipulating any of itsfinancial statements in hiding its poor debt-paying condition. Hence, the auditor, in this case,would issue unqualified audit opinion for the Connor Company (Junior, Best and Cotter 2014).

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