ACC5AAS Advanced Auditing and Assurance Project- AJQ’s audit engagement


Audit Risk Assessment and Planning
You are a part of the team responsible for planning the Armour Energy Limited (ASX code – AJQ), an exploration and production company, audit engagement for 2021. You are required to gather relevant background information and prepare a report for a meeting with your audit seniors. Assume that this is the first time that the audit will be conducted by your audit firm for this client. The report should:


(a) Discuss the areas in which AJQ conducts its operations. 

(b) State and explain three laws/regulations (other than financial categories which include legislations such as: Corporations Act 2001, Australian taxation laws, Australian Accounting Standards etc.) that affect AJQ’s operations.

(c) List and explain three significant business risk factors that you need to consider for the AJQ’s audit engagement.

(d) Identify and explain three key accounts that could be at risk of material misstatements. These accounts should be selected based on risk analysis and understanding of AJQ and its environment. Also, list the key assertion at risk for each identified account

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