Auditing & Assurance Services: True & Fair View Case Study Analysis

This case study report examines the auditing and assurance services of Gold Fields Ltd, focusing on the true and fair view of its financial statements. It investigates the application of accounting standards, including the assessment of material misstatements, inherent and control risks, and the auditor's responses to assessed risks. The report analyzes key audit matters, going concern assumptions, and modifications to the auditor's opinion. Furthermore, it explores the implications of the findings in relation to the company's annual report, business risks, corporate governance, and the auditor's report. The study aims to evaluate the company's financial position and the auditor's role in ensuring compliance with accounting standards and providing a fair and accurate representation of the financial performance. The report also includes recommendations for improvement based on the analysis.

Running head: AUDITING AND ASSURANCE SERVICES
Auditing and assurance services
Name of the student
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AUDITING AND ASSURANCE SERVICES
Table of Contents
Executive Summary......................................................................................................4
Chapter 1: Introduction:................................................................................................5
1:1 Accounting Theories...........................................................................................5
1.2 Australian Accounting Standard.........................................................................8
1.3 Problem statement:.............................................................................................9
1.4 Research Aim and Objectives............................................................................9
1.5 Research Questions.........................................................................................10
1.6 Structure of the Study.......................................................................................10
Chapter 2: Discussion................................................................................................11
2.1 Company Overview...........................................................................................11
2.2 Meanings of Accounting Standards..................................................................11
Chapter 3: Research Methodology.............................................................................12
3.1 Introduction.......................................................................................................12
3.2 Research Method Outline.................................................................................13
3.3 Research Onion................................................................................................13
3.4 Research Philosophy........................................................................................13
3.5 Research Approach..........................................................................................14
3.6 Research Design..............................................................................................15
3.7 Data Collection Process....................................................................................15
3.8 Data Analysis Plan............................................................................................16
Chapter 4: Findings....................................................................................................16

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4.1 Introduction.......................................................................................................16
4.2 Assessment and identification of risk of material misstatement:......................17
4.3 Inherent and control risk:..................................................................................18
4.4 Materiality in Planning and Performing an Audit...............................................19
4.5 Auditor Responses to Assessed Risks.............................................................20
4.6 Subsequent Events...........................................................................................21
4.7 Going Concern..................................................................................................22
4.8 Forming an Opinion and Reporting on a Financial Report...............................24
4:9 Modifications to the Opinion in the Independent Auditor’s Report...................25
4:10 Emphasis of Matter Paragraph in the Independent Auditor’s Report.............26
4:11 Codes of Ethics for Professional Accountants................................................27
Chapter 5: Implication of findings...............................................................................29
5.1 Introduction.......................................................................................................29
5.2 Annual Report of the company.........................................................................29
5.2.1 Business Risk.............................................................................................29
5.2.2 Corporate Governance...............................................................................29
5.2.3 Audit Report...............................................................................................30
5.2.4 Key Audit Matter.........................................................................................31
5.2.5 Going Concern...........................................................................................31
5.2.6 True and fair view.......................................................................................31
Chapter 6: Conclusion and Recommendations..........................................................32

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6.1 Conclusion........................................................................................................32
6.2 Recommendations............................................................................................32
Reference and Bibliography.......................................................................................34

AUDITING AND ASSURANCE SERVICES
Executive Summary
The report contains details of the true and value concept and going concern concept.
It take into consideration of various accounting standard which are to be concern by
the auditor in order to get the actual picture of the financial report of the company.
The report is a research proposal based and it shows the various effect of the auditor
responsibilities in related to the financial statement of the company. It contain a detail
explanation of various standard of accounting in related to the company. This show
how the company should evaluate each standard and it should apply those standard
in the company. It also have shown the different auditor responsibility regarding the
auditor in related to the standard and how the auditor should carry those standard in
the auditing process in regard with the company. Lastly the report contain the detail
explanation of the findings and also the implication of those findings in regards of the
company. It contain the details of the true and fair view and also the concept of the
going concern in related to the financial statement. It include a detail explanation of
the company annual report and contain the audit key matters of the company and
how the auditor had taken care of the same.

AUDITING AND ASSURANCE SERVICES
Chapter 1: Introduction:
The case study report is prepared to address the relationship and impact of
the identified auditing standard in the context of different aspects of auditing theories.
The objective of preparing the report is to assess the true and fair status of the
financial statement of international company and criticizing the opinion that is given
on the independent audit report by focusing on the key audit matters that is provided
by the auditors of company. For the purpose of conducting research on the audited
financial statements, the company that has been chosen is Gold Field which is the
largest gold mining company of Australia. The company is a diversified producer of
gold which has eight operating mines and represent then considerable global
production which makes the company largest miner of underground gold in Western
Australia (goldfields.com 2019).
1:1 Accounting Theories
Financial accounting practices and theory which are the fundamental of any
organization. Each organization may be large or small irrespective of its
nature it require a set of principles so that they can maintain all the transaction
so that the organization can know the competitive position in the market
(Abraham, Harris & Auerbach 2017). This theories are the frameworks,
methodologies and principles which are used for the analysis and
implementation of the financial reporting. Accounting is a very broad concept
that involves many process such as recording, classifying, analyzing and
summarizing of the huge number of transaction and help the company to
determine the financial position of the company by helping them to prepare

AUDITING AND ASSURANCE SERVICES
the income statement and balance sheet from the accounting transactions
(Agha 2014)
. It is an art as well an science as it help the company to record the transaction
chronologically in a presentable way so that the accounting statement provide a true
and fair view of the business and also it help to determine the financial position by
able to know the surplus and the losses in regard with the business had accrued in
any period.
The theories of the accounting deals with the accounting steps and procedure
(Ahmed 2015). It can also be referred as the general framework with the help of
accounting practices that can be evaluated with the help of development of new
procedures and practices can guided. The accounting theories basically deals with
the maintenance of daily transactions, maintenance of cash, capital funding policies,
credit policies, revenue recognition, error and rectifications and cost control
techniques (Alhazaimeh, Palaniappan & Almsafir 2014). Every organization should
be very careful in regards with the dealing of finance. Accounting is basically deals
with the financial transaction and hence each accounting work have reason behind it.
The theories of accounting always explains each transaction with proper reason and
logical understandings so that each financial user can able to understand the logic
behind the accounting transaction and how it has been deal in the organization.
The theories and accounting practices are closely related to each other. The
accounting theories have been developed through explanations, analysis,
observations, scanning and scrutiny of the daily accounting practices followed by the
business organization. The theories are always based upon some logic and sound
reasoning. Practicing of the financial accounting is not possible if the person does

AUDITING AND ASSURANCE SERVICES
not have proper theoretical knowledge. Accounting theories help the management to
present their account properly so that it can present a proper image of the financial
books in front of the financial users. The theories can be many different types which
are been discussed below:
1. Evaluative theory: This theory help the organization to understand the quality
and the quantity of the event (Beattie 2014). It also measures the quantitative
and qualitative of any event.
2. Descriptive Theory: This theory deals with the reason of any financial events
and the effects related to the event in detailed (Bicu, Chen & Elliott 2017).
This help in forecasting of how the event is been treated in the accounting and
the explanation related to those events.
3. Inductive Theory: This theory helps the business to analysis and assesses
the past happenings of any such event (Birt, Rankin & Song 2013). This is
also based upon the repeated experiments and also informs related to the
accountants which are similar to such events which are doing to the happen in
future and the consequences related to it.
4. Deductive Theory: This event shows the future behavior of any particular
event (Bloom 2013). This theories are made by the organization in order to
achieve the future goals of the company.
5. Generally Accepted Theory – These are the basic principle which are
followed by all the accounting process (Bonin 2013). These theories give an
outline to the accounting process and can be applied be adopted by all types
of organizations
6. Communicative Theory – This theory help the business to forecast their
future events (Brei & Gambacorta 2014). These is the only theory which help

AUDITING AND ASSURANCE SERVICES
the company to forecast the future events of the business and help them to
make proper strategy regarding the business which is going to happen in
future
7. Normative Theory – This theory help the management to compare the future
acts in regards with the daily present events (Camfferman & Zeff 2015). It also
have several possibilities that are independent in the present case and help
them to judge and correct its impact upon the future events of the company.
1.2 Australian Accounting Standard
Accounting standard are the base of the theories and practices which each
types of organization have to maintain the accounting procedure in respect of
each standards. It give an overview of the accounting practices and policies.
These are the most reliable source of information and it’s the base of financial
reporting and these are the primary source of the theory of Generally
Accepted Accounting Principles (Australian Auditing Standards 2019). The
standard on accounting are been set by the Australian Accounting Standard
Board. The board maintain and regulate the standard in related to the
financial reporting which should be done by the all the entity in Australia. The
powers of the standard board lies with the Australian Securities and
Investment Commission Act 2001. The reporting is divided into two tiers:
i. Australian Accounting Standards
ii. Australian Accounting Standards – Reduced Disclosure Requirements
The first tier shows the accounting methods which should be as per
International Financial Reporting Standards that has issued by the
International Accounting Standard Board. This give an outline how the

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company should develop its reporting and how they should do accounting
of each transaction. The second tier involves in related to the first tier as it
involves recognizing, presenting and measuring related to the information
of Tier 1. As per the Corporation Act 2001 all the Australia entities must
follow the accounting standard while preparing their financial statements.
This report present the rules and norms which the organization must follow
in related to the financial reporting and how it should applicable in related
accounting standard (Carey, Potter & Tanewski 2014). This help the
company to make a clear picture and help them to represent a true and
fair view or not. As this standard is applicable for all the entity so this help
the financial user to know more about the company and how the financial
position of the company is in the market.
1.3 Problem statement:
The problem statement of this paper is to risk of material misstatement and
ascertaining whether such risk has been assessed by the auditor of company. The
paper also tends to identify whether the entity operate as going concern and whether
the repotting entity has modified the opinion presented by the independent auditor.
This paper all deals with all the related standard of audit and how it affect in the
company financial statement related to show true and fair view of the company.
1.4 Research Aim and Objectives
The main aim of the research is to determine true and fair value status in the
financial statement and also about the auditor key factors related to the company, it
involve the interpretation of the annual report of the company Gold Fields Ltd. The
research objective is stated as below:

AUDITING AND ASSURANCE SERVICES
i. To check whether the company financial statement are showing true and
fair view or not.
ii. To analysis the balance sheet of the company and to know whether all the
standards are been followed or not.
iii. To interpret the opinion of the auditor related to the financial statements.
iv. To check the key audit matters related to the company.
v. To check application of different standard and how the company have
implied them in the business.
vi. To interpret auditing approach and concepts related to the financial
statements.
1.5 Research Questions
The research questions that are addressed here are as follows:
i. To check the opinion of the auditors
ii. To check the concept of true and fair view
iii. To analysis the financial statement in regards with audit
iv. To check different types of the standards
1.6 Structure of the Study
The research work discuss about the concept of financial accounting
standards and how they are implement in the organizations. It discuss about the true
and fair view concept and the importance of them in the financial statements. The
aims and objective of the research work is based upon the above research question
which have been prepared above. The discussion is based upon the company
named Gold Field limited about the concept of the true and fair view based upon this

AUDITING AND ASSURANCE SERVICES
the findings in the research and the findings are been backed up by the conclusion
and recommendations.
Chapter 2: Discussion
2.1 Company Overview
Gold Fields Limited is one of the biggest largest gold mining firm. It is based
upon the Australia. It headquarter is situated in Johannesburg, South Africa. The
company operates its business in South Africa, Peru and Australia. It produced gold
and have more than seven operating mines in Australia and also some other part of
Ghana, Peru and South Africa.
2.2 Meanings of Accounting Standards
The government and the professional of Australia is been leading the
development of innovative standard of accounting and accounting reforms in
both private as well as public sector (Australian Auditing Standards 2019). These
bodies also play a very important roles in the development of International
Accounting Standard Board which are generally called as IASB. They are
playing a very important roles in related to the decision of International
Accounting Standard.
All the company financial statements and the financial reporting should
comply with the prescribed accounting standards. Compliance with the accounting
standard helps in better presentation of the financial position, cash flows and help to
know the financial position and performance of the organization (Carraher & Van
Auken 2013). This financial statement contains the information which are very helpful
for the financial users such as owners, shareholders, employees , investors and