HI6026 Audit, Assurance and Compliance Doc

Added on -2020-02-18

| HI6026| 13 pages| 2606 words| 118 views

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Running head: AUDITING AND ASSURANCEAuditing and AssuranceUniversity NameStudent NameAuthors’ Note
2AUDITING AND ASSURANCESolution to Question 1:Part AImplementation of analytical process to the financial report of Double Ink PrintersLimited (DIPL)Proper employment of specific analytical processes to different financial declarations of thecorporation can back the process of improvement of the design of audit. Basically, auditplanning can replicate particular guideline that need to be monitored during a particular timeof execution of audit exercise. Essentially, strategy of analysis also helps assessors insupporting and examining audit expends at sensible phase (Eilifsen et al. 2013). Additionally,this also helps in the elucidating the misapprehension along with miscommunication withdifferent consumers of particular corporation. Inspective mechanism of mainly commonsizing supports analysis of financial statements in a particular way. Essentially, evaluatorscan also speak about diverse categories of elements detected in the financial assertions.Subsequently, this can help in assessment of the overall manner of disclosing differenteconomic announcements. Again, this mechanism can be appropriately implemented forevaluating financial assertions and simultaneously evaluating idea of financial evaluation. Ratio analysis system can be implemented for the analytical assessment after analysis offinancial information of the company Double Ink Printers Limited (DIPL) for threesuccessive years (Beasley 2015)Analysis of Profitability of DIPL
3AUDITING AND ASSURANCEThe table presented above reflects the profitability ratio of the company Double Ink Printersand each one of ratio represents the overall profitability position of the business corporation. -Analysis of the gross profit ratio of the firm for 3 successive years reveals theprofitability condition of the firm. This gross profit ratio of the corporation hasdeclined from 17.55% to around 16.13% and further to 15.20% during the year 2015. -Net profit of the firm DIPL for the 3 successive years is recorded to be 6.09% during2013, 6.08% registered 2014 and 6.84% recorded during the year 2015. Enhanced netprofit ratio of the firm documented during the year 2015 is mainly due to high interestexpends of the firm for that specific year incurred by DIPL (Humphrey et al. 2014)-Return on Assets (ROA) of firm DIPL is calculated to be 18.25% during the year2013, 14.41% during the year 2014 and 11.3% during the year 2015. Downward trendof ROA for the firm is not desirable and therefore this calls for the need for
4AUDITING AND ASSURANCEengagement in further acquirement of assets in the upcoming future (Broberg et al.2013). -Return on Equity (ROE) of the corporation DIPL for 3 successive years is enumeratedto be 25.78% during the year 2013, 21.25% during the year 2014 and 24.26% duringthe year 2015. Liquidity AnalysisThe table presented replicates the liquidity condition of the corporation DIPL and thistable shows that the liquidity condition of the firm has improved considerably over thethree successive years-Current ratio enumerated from the financial report of the firm DIPL is recorded to be1.42 during the year 2013, 1.47 during the year 2014 and 1.50 during the year 2015.In essence, this shows that the liquidity condition of the firm DIPL has considerablyenhanced marginally during the year 2015 (Arens et al. 2014).

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