- 8 Marks
AAA – May 2018 – L3 – SC – Q7a – Audit Reporting
Prepare a management representation letter for Banana Follow Me Limited and outline anti-money laundering requirements for the audit team.
Question
You are the accountant to Banana Follow Me Limited and the audit of the financial statements for the year ended December 31, 2016 is currently ongoing. The company is a cocoa processing entity with various factories across the country. During the year end audit, the auditors, Akinfenwa & Company. (Chartered Accountants), observed that the company purchased
200,000 units of XYZ Plc. shares during the year and that the company had not recognised dividends on these shares as at year end. Upon enquiry, the Managing Director of the company explained that the
shares were purchased ex-dividend and had promised to provide suitable representations to confirm this. The auditors have verified this and are 106 satisfied with the explanation but expect representation letter which includes all other relevant representations from the company.
Required:
As the accountant to Banana Follow Me Limited, prepare the management representation letter to be issued to the company’s auditors, Akinfenwa & Company, confirming representations for the financial statements for the year ended December 31, 2016.
Find Related Questions by Tags, levels, etc.
- Tags: Anti-Money Laundering, Audit Compliance, Representation Letter, Risk Management
- Level: Level 3
- Topic: Audit Reporting
- Series: MAY 2018