Question

Do you find all the elements as you have learnt, or do you find any difference? if yes bring out the differences.

Auditors' Report to the sharehoders

Scope of aduit:

We have aduited the accompanying consolidated balance sheet of x industries corporation and its subsudaries (the "Group") as at 31 December 2016 and the related consoildated statments of income, cash flows and shareholders' equity forr the Group's management and have been prepared by them in accordance with the requirememtns of the regulations for companies and submitted to us together with all the infromation and explanations which we required. Our responsibility is to express an opinion on these consolidated financial statments based on our aduit.

We conducted our audit in accordance with auditing standards generally accepted in the country. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statments are free of material misstatment. An audit includes examing, on a test basis, evidence supporting the amounts and disclosures in the financial statments. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluting the overall financial statment presentation. We believe theat our audit provides is reasonable degree of assurnace to enable us to express an opinion on the consolidated financial statment.

Unqualified opinion

In our opinion, the consolidated financial statment taken as a whole:

- present fairly, in all material respects, the onsolidated financial position of the Group as at 31 Decmber 2016 and the results of its operations and its cash flows for the year then ended in accordance with accounting standards generally accepted in the country.

- comply with the requirements of the requlations for companies and industries by laws in so far as they aggect the prepatation and presentation of the consolidated financial statments.

Answer 1

Scope of audit:

The scope of audit is the paragraph where an auditor outlines the documents which are to be examined and verified by the auditor for the purpose of auditing. It is an important aspect of auditing as it outlines the scope of the audit, i.e. the documents to be verified, the books of accounts to be checked and the respective responsibility of management and other officials of the organization to ensure that there is necessary resources available which are to be used for the purpose of auditing. The auditing standards that are to be used in the course of auditing shall also be explained and mentioned in the scope of the audit.

In this case the scope of audit has outlined the documents that are to be verified and examined by the auditor to express his opinion on the fair and correct representation of the financial position and performance. The auditor has also mentioned that the audit has been conducted in accordance with the generally accepted auditing standards in the country.

The fact that the auditor has expressed unqualified opinion on the financial statements have also been mentioned in the scope of audit. Thus, the audit scope is almost full and complete in all respects except the following:

1. The auditor should have elaborated a little on the method and processes that have been used to verify the books of accounts and other documents during the course of auditing. .
2. The management representations and the extent to which the auditors have relied on them to come to the conclusion should also have been mentioned.

Thus, apart from above two differences there are no other differences in the scope of audit.