- 10 Marks
AA – May 2017 – L2 – Q3c – Completion Procedures and Reporting
Audit procedures for determining if PharmaCo can continue as a going concern.
Question
PharmaCo provides scientific services to a wide range of clients. Typical assignments range from testing food for illegal additives to providing forensic analysis on items used to commit crimes to assist law enforcement officers.
The annual audit is nearly complete. As audit senior, you have reported to the engagement partner that PharmaCo is having some financial difficulties. Income has fallen due to the adverse effect of two high-profile court cases by customers who bought drugs from the company.
Required:
Explain the audit procedures that may be carried out to determine whether or not PharmaCo has the ability to continue as a going concern entity.
Find Related Questions by Tags, levels, etc.
- Tags: Audit Procedures, Cash Flow Forecasts, Going Concern, ISA 570
- Level: Level 2
- Topic: Completion Procedures and Reporting
- Series: MAY 2017
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