Question

In: Accounting

The evaluating and concluding stage of the audit process is very important. At this stage all...

The evaluating and concluding stage of the audit process is very important. At this stage all the evidence that has been gathered on the audit must be brought together so that decisions can be taken as to whether anything further needs to be done and ultimately what the appropriate audit opinion will be.
YOU ARE REQUIRED TO:
a. State, giving reasons which member of the audit team should conduct the evaluation of audit evidence and conclude on fair presentation. (3)
b. Briefly discuss the factors which the auditor should consider when evaluating and concluding. (12)

Solutions

Expert Solution

a. As per ISA 315, engegement partner or the head of the audit team shall conduct the evaluation of audit evidence along with the team members. Serious issues shall be discussed with senior partners of the audit firm

b. factors which the auditor should consider when evaluating and concluding are:

  • Results of the analytical procedures taken while reviewing FS
  • Misstatements noted during the course of audit taking a big picture of their inter relation if any
  • Internal controls implemented by the management
  • Chances of fraud risk involving senior managment
  • Disclosures to be made in the report in consensus with accounting standards
  • Involvement of managment in audit process, were all material documents provided.
  • Special/specific regulations imposed over the company
  • Unusual or unexpected transactions, events, amounts, or relationships3 indicate risks of material misstatement that were not identified previously, including, in particular, fraud risks

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