You are a newly qualified accountant who works for the auditfirm Harrison Ford & Co. You have been approached by apotential new client, Calista Electronics Pty Ltd, who is lookingfor an audit firm to carry out an audit on its annual financialreport prepared in accordance with the Corporations Act. Themanaging director, Calista Flockhart, is not sure exactly what anaudit involves and what are the responsibilities of theauditor.
Required: Prepare notes for a meeting with Calista Flockhartwhich identifies the responsibilities of the auditor and theresponsibilities of management.
The notes should cover the following:
ï Distribution of the annual report to shareholders.
ï Delivery of the audit report to the entity.
ï Obtaining and evaluating evidence concerning the financialreport.
ï Preparation and presentation of the financial report.
ï Maintaining adequate internal controls.
ï Testing internal control procedures.
ï Expressing an opinion on the financial report.
ï Selecting appropriate accounting policies.
ï Ensuring the financial report is presented in accordance withstandards.
ï Performing test of controls.
You are a newly qualified accountant who works for the auditfirm Harrison Ford & Co. You have been approached by apotential new client, Calista Electronics Pty Ltd, who is lookingfor an audit firm to carry out an audit on its annual financialreport prepared in accordance with the Corporations Act. Themanaging director, Calista Flockhart, is not sure exactly what anaudit involves and what are the responsibilities of theauditor.
Required: Prepare notes for a meeting with Calista Flockhartwhich identifies the responsibilities of the auditor and theresponsibilities of management.
The notes should cover the following:
ï Distribution of the annual report to shareholders.
ï Delivery of the audit report to the entity.
ï Obtaining and evaluating evidence concerning the financialreport.
ï Preparation and presentation of the financial report.
ï Maintaining adequate internal controls.
ï Testing internal control procedures.
ï Expressing an opinion on the financial report.
ï Selecting appropriate accounting policies.
ï Ensuring the financial report is presented in accordance withstandards.
ï Performing test of controls.
