Trade Payables – NBC Institute

AA – May 2016 – L2 – Q7a – Audit Evidence

Identify additional information needed to determine the audit opinion for Musky Fresh Ltd following supplier difficulties.

Question

Musky Fresh Limited has been in existence, for a number of years, importing perfume. The managing director had built up the business using contacts he already had in the industry. The company imports only one brand of perfume which is manufactured exclusively by one company. The perfume is distributed via ‘shops within shops’ at 20 branches of a well-known store. Under this agreement, Musky Fresh Limited pays a percentage of its takings to the store, with a minimum annual payment of N100,000 per store.

The audit is nearing completion, but you have just heard that the Arabian manufacturer is facing serious financial difficulties, and that supplies have ceased.

Required:

a. Set out the further information the auditor would require before reaching his audit opinion. (6 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit opinion, Financial difficulties, Going Concern, Supplier Risks, Trade Payables
Level: Level 2

Topic: Audit evidence
Series: MAY 2016

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

Question

Control activities may be defined as policies, procedures, and operations that help to enable management directives to be carried out. These activities are detailed procedures designed to prevent, or to detect and correct errors that may arise in processing information.

Required:

a. Set out the five types of control activities and illustrate each one in the context of purchases or trade payables system. (10 Marks)

b. Explain why, even where tests of controls prove satisfactory, substantive procedures can never be completely eliminated. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Control Activities, Internal Controls, Purchases System, Substantive Procedures, Trade Payables
Level: Level 2

Topic: Internal Control Systems
Series: MAY 2016

AA – May 2016 – L2 – Q7a – Audit Evidence

Identify additional information needed to determine the audit opinion for Musky Fresh Ltd following supplier difficulties.

Question

The audit is nearing completion, but you have just heard that the Arabian manufacturer is facing serious financial difficulties, and that supplies have ceased.

Required:

a. Set out the further information the auditor would require before reaching his audit opinion. (6 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit opinion, Financial difficulties, Going Concern, Supplier Risks, Trade Payables
Level: Level 2

Topic: Audit evidence
Series: MAY 2016

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

Question

Required:

a. Set out the five types of control activities and illustrate each one in the context of purchases or trade payables system. (10 Marks)

b. Explain why, even where tests of controls prove satisfactory, substantive procedures can never be completely eliminated. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Control Activities, Internal Controls, Purchases System, Substantive Procedures, Trade Payables
Level: Level 2

Topic: Internal Control Systems
Series: MAY 2016

Question Tag: Trade Payables

Filter by Professional Bodies

Filter by Subject

Filter by Series

Filter by Topics

Filter by Levels

AA – May 2016 – L2 – Q7a – Audit Evidence

Identify additional information needed to determine the audit opinion for Musky Fresh Ltd following supplier difficulties.

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

AA – May 2016 – L2 – Q7a – Audit Evidence

Identify additional information needed to determine the audit opinion for Musky Fresh Ltd following supplier difficulties.

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

Our offerings

Contact Info

Customer

Get In Touch

Question Tag: Trade Payables

Filter by Professional Bodies

Filter by Subject

Filter by Series

Filter by Topics

Filter by Levels

AA – May 2016 – L2 – Q7a – Audit Evidence

Identify additional information needed to determine the audit opinion for Musky Fresh Ltd following supplier difficulties.

You're reporting an error for "AA – May 2016 – L2 – Q7a – Audit Evidence"

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

You're reporting an error for "AA – May 2016 – L2 – Q6 – Internal Control Systems"

AA – May 2016 – L2 – Q7a – Audit Evidence

Identify additional information needed to determine the audit opinion for Musky Fresh Ltd following supplier difficulties.

You're reporting an error for "AA – May 2016 – L2 – Q7a – Audit Evidence"

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

You're reporting an error for "AA – May 2016 – L2 – Q6 – Internal Control Systems"

Our offerings

Contact Info

Customer

Get In Touch

admin