This document provides a comprehensive solution to the ACC00130 Auditing assignment, an open-book exam based on the Lakeside Company case study. The solution addresses various aspects of auditing, including responsibility, quality control, ethics, and professional requirements, with specific examples of ethical threats and quality control breaches. It analyzes audit risk and procedures, identifying different types of audit procedures and their purposes, as well as the components of audit risk. The assignment also explores auditor legal liability, discussing potential liabilities to clients and third parties based on legal precedents. Furthermore, it covers engagement acceptance, risk, and materiality, examining the factors influencing audit risk and their impact on the assessment of material misstatement, detection risk, and audit strategy. The solution also delves into assertions and substantive procedures, linking audit procedures to management assertions and identifying substantive procedures for auditing sales and accounts receivable. Finally, the document addresses the audit of accounts payable, including the identification of relevant assertions and substantive procedures. Overall, this document offers a detailed and practical guide to understanding and solving auditing assignments, making it a valuable resource for students studying finance and auditing.
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