Auditing and Assurance - Assignment

Running head: AUDITING AND ASSURANCE
Auditing and Assurance
Name of the Student:
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AUDITING AND ASSURANCE
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Table of Contents
ASX Corporate Governance Principles...........................................................................................2
Risk Assessment..........................................................................................................................4
Nature of the Company................................................................................................................4
Market Overview.........................................................................................................................5
Regulating Authority...................................................................................................................5
Ratio Analysis..................................................................................................................................5
Horizontal Analysis.........................................................................................................................5
Audit Risks......................................................................................................................................7
Measures..........................................................................................................................................7
Reference.........................................................................................................................................9

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1. Executive Summary
The main purpose of this assignment to review the financial statements as prepared by Aristocrat
Leisure ltd. The assignment will be dealing with how the company follows and implements ASX
Corporate Governance Principles for day to day management of the business. In addition to this,
a risk assessment will be conducted on the financial statements of the company to ascertain if the
business faces any risks or not. The assignment will also be including horizontal analysis which
consists of a Common Sized Income statement and Balance sheet and significant ratio
computation will also be included in the assignment. The report will be concluding with
recommendations which are applicable to the business and which can reduce the risks which are
related to the business.
ASX Corporate Governance Principles
1. Lay Solid Foundation for management and Oversight: The board has clearly set out the
functions which are to be handled by the board and delegated those functions which are
to be handled by the management (Beekes, Brown and Zhang 2015). The board has
delegated authority to the CEO of Aristocrat Leisure ltd to look after the day to day
business of the company and regulate the same within the purview of the authority
provided. The board is responsible for reviewing the management and various roles and
responsibilities of the company. The company secretary is directly accountable to the
board for facilitating the corporate governance policies of the business and also overall
management of the business (Picken 2017). The company follows strict code so as to
ensure that the corporate governance policy of the company is being followed.
2. Structure the board to add value: The board of directors of the company is made up of
Executive and Non-Executive directors. Out of the Non-Executive directors 50% of the

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composition is taken by women (Kumar and Singh 2013). For effective delegation of
power and responsibility the board has set up audit committee, nomination committee
and other regulatory committee as well.
3. Act Ethically and Responsibly: The board of Aristocrat Leisure ltd has put in all efforts
to establish a working environment which is ethically developed for business dealings
and other business-related activities (Weiss 2014). The company has developed a code of
conduct which is applicable to all directors, managers and all personnel of the business.
The main purpose of the establishing the code of conduct in the business is to ensure that
the financial statements are effectively prepared and integrity is maintained.
4. Safeguard Integrity in Corporate Reporting: The board is responsible for the effective
representation of the financial statements of the company. The board has set up audit
committee which is responsible to recommend to the board about the accounting policies
risk management practice of the business (Gao and Jia 2016). There is also an audit
committee charter which defines the role and responsibility of the committee more
effectively (Ezzine and Olivero 2013). In addition to this, the management of the
company has given the power to conduct independent examinations for the ensuing
effective risk management standard and reporting framework is followed.
5. Make timely and Balanced Disclosures: Aristocrat Leisure ltd has successfully developed
and implemented the policy which relates to continuous disclosure of significant items.
The management of the company understands that timely disclosure of price sensitive
information is necessary and effective communicaat6ion of the same is necessary (Fung
2014). The company secretary in conjunction with the CEO of the business has the
responsibility to look into such requirements.