HA3032 Auditing Group Report: Carsales.com Audit Program

This report provides an introduction to auditing, emphasizing its importance in financial statement analysis. It examines Carsales.com, an online automobile and motorcycle business in Australia, analyzing its business risks (liquidity, unfavorable economy, competitors) and audit risks (detection, control, inherent). The assignment details the planning materiality calculation for Carsales.com and presents the audit risk model. The report concludes by highlighting the significance of auditing and includes a bibliography of relevant sources, including articles discussing audit committee power, audit quality, and risk-based auditing. The report fulfills the requirements of the HA3032 Auditing course, focusing on developing an audit program and understanding audit procedures.

AUDITING

INTRODUCTION
 It is a process which is been carried
upon the financial statement of the
company
 To check the check have complied all
the rules and regulation
 To check the principle of true and fair
view

OVERVIEW OF CARSALES.COM
 It is an online based company
 It deals in automobile
 It deals in motorcycle
 It carry its business in Australia

Types of business risk
 Liquidity Conditions
 Unfavorable Economy
 Competitors

Types of Audit risk
 Detection Risk
 Control Risk
 Inherent Risk

Planning Materiality of the company
 As per the company Carsales.com is
been used so the base amount is
been consider as sale of the
company and the estimate is been
consider as 4% so the computation
of the planning materiality is been
listed below:
 Planning Materiality = Revenue *
4%
 = $444009 * 4%

Audit Risk Model

CONCLUSION
 It show the importance of auditing in
the company
 Types of business risk
 Types of Audit risk
 Planning Materiality
 Analytical review of the company

Bibliography
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Audit committee versus CFO power and audit fees. The
Accounting Review, 89(6), pp.2057-2085.
 Bell, T.B., Causholli, M. and Knechel, W.R., 2015. Audit firm
tenure, non‐audit services, and internal assessments of audit
quality. Journal of Accounting Research, 53(3), pp.461-509.
 Chen, Y., Gul, F.A., Veeraraghavan, M. and Zolotoy, L., 2015.
Executive equity risk-taking incentives and audit pricing. The
Accounting Review, 90(6), pp.2205-2234.
 Chou, D.C., 2015. Cloud computing risk and audit
issues. Computer Standards & Interfaces, 42, pp.137-142.
 Christensen, B.E., Glover, S.M., Omer, T.C. and Shelley, M.K.,
2016. Understanding audit quality: Insights from audit
professionals and investors. Contemporary Accounting
Research, 33(4), pp.1648-1684.

 Donohoe, M.P. and Robert Knechel, W., 2014. Does
corporate tax aggressiveness influence audit
pricing?. Contemporary Accounting Research, 31(1),
pp.284-308.
 Ettredge, M., Fuerherm, E.E. and Li, C., 2014. Fee
pressure and audit quality. Accounting, Organizations and
Society, 39(4), pp.247-263.
 Griffiths, P., 2016. Risk-based auditing. Routledge.
 Groomer, S.M. and Murthy, U.S., 2018. Continuous
auditing of database applications: An embedded audit
module approach. In Continuous Auditing: Theory and
Application (pp. 105-124). Emerald Publishing Limited.
 Jha, A. and Chen, Y., 2014. Audit fees and social
capital. The Accounting Review, 90(2), pp.611-639.