Financial Decision Making for Creative Projects and Events Assignment

This assignment discusses the substantive and analytical procedures that an auditor must perform while conducting the physical count of inventory, inherent risk factors present in intangible assets, substantive analytical procedures that can be applied in case of plant property and equipment, and methods that can be applied in auditing the income statement.

FINANCIAL DECISION
MAKING FOR
CREATIVE PROJECTS
AND EVENTS
ASSIGNMENT

1
By student name
Professor
University
Date: 26 November 2017.
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Contents
Question 1………………….....……………………….………....……..……………………………………….3
Question 2…………….…………..………………....……..………………………………………………..…..3
Question 3……………….…..………………....……..……………………………………………………….….3
Question 4……………….…..………………....……..……………………………………………………….…..3
References………..…….…………..………………....……..……………………………………………………..4
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1)There are few substantive and analytical procedures that the auditor must perform while
conducting the physical count of inventory like test checking the presence of the same in the
register. The auditor must see that all the inventories are tagged separately and are accounted for
accordingly (Alexander, 2016). If there is inventory present at several locations, then that
locations where the maximum portion of the same is there must be checked. After all the
checking reconciliation must be done. Sample check is the most common method that is applied
to check the validity of a particular population.For example, if there are 10000 item of inventory
then sample test can be done on certain items to know the feature of the entire population. If the
company is having stock at three locations A. B and C then the auditor should audit that portion
where there is the maximum inventory stored out of the three.
2) In case of intangible assets few inherent risk factors that are present are- If there are changes
in the overall technological scenario then the development of the asset might get affected. It is
difficult to conduct audit transactions in case of an intangible asset. Few accounting issues that
are involved in case of the same are of complex nature like valuation of impairment cost,
ascertainment of fair value etc (Bromwich & Scapens, 2016).
3)Few substantive analytical procedures that can applied in case of plant property and equipment
are – The auditor must choose an assertion that will reflect the current position of the assets
while studying the year-end balance, like completeness, valuation and other various aspects
covered in valuation (Drew, 2017). The auditor must take steps to identify the risk element that
might be involved in case of such audits and try to reduce it to minimum level.
4)In case of auditing the income statement, the auditor must apply methods that will help them
identifying any deviations in the statement from the actual present financial state of the
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company. The auditor must see to it that the financial statement is related to the period for which
it is specified, then the auditor must check the accuracy of the same by studying each element
separately (Visinescu, et al., 2017).
References
Alexander, F., 2016. The Changing Face of Accountability. The Journal of Higher Education, 71(4), pp.
411-431.
Bromwich, M. & Scapens, R., 2016. Management Accounting Research: 25 years on. Management
Accounting Research, Volume 31, pp. 1-9.
Drew, J., 2017. IASB proposes changes around accounting policies and estimates. Journal Of
Accountancy.
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Visinescu, L., Jones, M. & Sidorova, A., 2017. Improving Decision Quality: The Role of Business
Intelligence. Journal of Computer Information Systems, 57(1), pp. 58-66.
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