ACCT3000 Auditing Theory and Practice

QUESTION 1 (15 Marks)
You are the external auditor for ABCM Pty Ltd, a merchandising company. You have performed the following audit procedures:
(a) A random sample of creditors was selected from the invoices and reconciliations (where appropriate) and agreed to the accounts payable ledger. (3 Marks)
(b) Developed a simple spreadsheet model to enable the recalculation of wages expenses.
(3 Marks)
(c) Attended each monthly stock-take, selecting a sample of 130 items from the stock-sheets and agreeing them to the physical stock in the warehouse. (3 Marks)
(d) Gathered external confirmation from the financial controllers of two debtors of
ABCM Pty Ltd, regarding a total outstanding amount of $60,000 at balance date.
(3 Marks)
(e) Asked one of your assistants to vouch the legal title documents pertaining to ABCM Pty Ltd’s machineries in the factory. (3 Marks)
Identify the key assertion that you are most likely testing with each of the above procedures and provide an explanation for your answer
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