Audit and Assurance

Running head: AUDIT AND ASSURANCE
Audit and Assurance
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AUDIT AND ASSURANCE
Executive Summary
The main purpose of the assessment is to analyse the financial statements of an ASX listed
company for analysing whether the annual reports are free from material misstatements of the
business. The company which is considered is WoolWorths ltd which is engaged in the business
of retail. The assessment shows that the stakeholders of the business are important constraints
and they are also affected by the activities of the business. The assessment would also include
discussion on the case of Enron and the factors which caused the collapse of company. The
analysis of Medcraft article are also considered for improving the quality of audit.

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AUDIT AND ASSURANCE
Table of Contents
Introduction................................................................................................................................... 3
Stakeholder’s Analysis................................................................................................................... 4
Independence and whistleblowing in relation to auditors:...........................................................6
Lessons from Enron Scandal..........................................................................................................7
Audit quality and steps to be taken by the auditors for Medcraft...............................................10
Conclusion................................................................................................................................... 11
Reference.....................................................................................................................................13

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AUDIT AND ASSURANCE
Introduction
The investors of the business are the owners of a company and therefore they need to
know whether the company in they have invested their money is performing well or not. The
only way the investors are able to interpret the performance of a business is through audit
financial statements. In case the financial statements which is shown to the investors contain
material misstatement than the same poses a serious risk for the investors as well as the
auditor which has conducted the audit for the business (Tepalagul and Lin 2015). The
assessments cover the interests of the stakeholders of the business by analysing annual reports
of a company which is listed in Australian Stock Exchange (ASX). The company which is taken
into consideration is Woolworths ltd which is considered to be giant in the business of retail
and has a significantly large operations (Woolworthsgroup.com.au. 2019). The assessment
considers the impact of material misstatement on the stakeholders if the annual reports of
Woolworths ltd contain the same.
The second part deals with the concept of whistleblowing in a business and APES 110
requirements which needs to be followed by every professional (Rahmina and Agoes 2014). The
assessment also includes analysis of the downfall of Enron and the lesson which Arthur
Anderson learnt from the case (Foster and Shastri 2013). The assessment would be concluding
with audit quality steps which is taken by the auditor after examining the financial statements
of G. Medcraft.