Audit & Assurance: Wesfarmer - Principles of Auditing and Analysis of Various Audit Matters

AUDIT & ASSURANCE

Wesfarmer
Executive Summary
The role of auditors in the smooth functioning of the company is vital because they are the
professional who are engaged in providing a true and fair view of the state of affairs. Further,
the auditors are responsible for conducting the audit and ensure that the financial statements
are free from errors because any error will dampen the goodwill of the company and provide
misleading information that might not go well with the status of the company. In this report,
the major emphasis is on the principles of auditing. For this purpose Wesfarmer is selected
that is listed on the ASX and in the light of this company various audit matter is studied. The
report initiates with the introduction followed by the compliance system with the needful
requirements. Further, non audit services and auditor remuneration is highlighted. Thereafter,
the audit committee is studied for the company. The report even sheds light on the
subsequent material events and the missing information.
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Wesfarmer
Contents
Introduction...........................................................................................................................................3
Compliance with the necessary statutory requirements.........................................................................3
Non-audit services.................................................................................................................................3
Calculation of the salaries given to auditors..........................................................................................4
Audit Committee...................................................................................................................................5
Significant audit matters........................................................................................................................5
Are the management’s and auditors responsibilities different from one another?..............................6
Key subsequent events..........................................................................................................................7
Effectiveness of the auditor’s report......................................................................................................7
Under-reporting/missing information....................................................................................................8
An auditor can be questioned that whether-...........................................................................................9
Conclusion...........................................................................................................................................10
References...........................................................................................................................................11
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Wesfarmer
Introduction
In order to trace errors and frauds in the financial statements of the company, the auditors
should always make sure that they are focussing on the internal control system of the same
company. This will aid them in detecting material misstatements caused as a result of errors
or/and frauds and representing a true and fair view of the financial well being of the company
in their audit reports. Considering the audit process carried out at Wesfarmers, it would be
fair enough to say that the reports of the company reflected transparency of its affairs and
offered a true and fair picture of its financial performance (Wesfarmer, 2017). The credit for
the same can be entirely given to the auditors for the functioning of the same was considerate
and also the company was able to adhere to all the necessary independent requirements
especially the ones like The Corporations Act, 2001.
Compliance with the necessary statutory requirements
The company was able to survive and expand in its industry in the presence of all its rivalry
companies owing to the compliance that was made with all the necessary statutory
requirements. The fact that the company was able to adhere to almost every independent
requirements is highly appreciable. The audit report of Wesfarmers too highlighted the fact
that the company has been in compliance with all the necessary standards. All such necessary
statutory requirements were based on the Corporations Act, 2001 which affirms the true and
fair view of the financial performance of the organization and APES 110 code of ethics that
are especially for professional accountants (Wesfarmer, 2017). Also, certain other significant
matters apart from compliance are also dealt with appropriately.
Non-audit services
In context of non-audit services, it can be said that the audit committee of the company has
extended their services by means of providing legal and ethical advice on the same. Also, all
these legal and ethical suggestions were provided in written form for the purpose of non-audit
services so as to comply with the resolutions made. Not only this, the board assessed the risk
on behalf the risk committee and they were extremely contended seeing that the auditors of
the company are well capable of offering non audit services as well by means of giving legal
and ethical suggestions (Wesfarmer, 2017). The capability of the auditors in providing both
auditing and non audit services was reflected in the annual report of the company which
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