5 You are an audit manager in Dedza, a firm of Chartered Certified Accountants. Recently, you have been assignedspecific responsibility for undertaking annual reviews of existing clients. The following situations have arisen inconnection with three client
题目
5 You are an audit manager in Dedza, a firm of Chartered Certified Accountants. Recently, you have been assigned
specific responsibility for undertaking annual reviews of existing clients. The following situations have arisen in
connection with three client companies:
(a) Dedza was appointed auditor and tax advisor to Kora Co, a limited liability company, last year and has recently
issued an unmodified opinion on the financial statements for the year ended 30 June 2005. To your surprise,
the tax authority has just launched an investigation into the affairs of Kora on suspicion of underdeclaring income.
(7 marks)
Required:
Identify and comment on the ethical and other professional issues raised by each of these matters and state what
action, if any, Dedza should now take.
NOTE: The mark allocation is shown against each of the three situations.
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第1题：
5 You are an audit manager in Fox & Steeple, a firm of Chartered Certified Accountants, responsible for allocating staff
to the following three audits of financial statements for the year ending 31 December 2006:
(a) Blythe Co is a new audit client. This private company is a local manufacturer and distributor of sportswear. The
company’s finance director, Peter, sees little value in the audit and put it out to tender last year as a cost-cutting
exercise. In accordance with the requirements of the invitation to tender your firm indicated that there would not
be an interim audit.
(b) Huggins Co, a long-standing client, operates a national supermarket chain. Your firm provided Huggins Co with
corporate financial advice on obtaining a listing on a recognised stock exchange in 2005. Senior management
expects a thorough examination of the company’s computerised systems, and are also seeking assurance that
the annual report will not attract adverse criticism.
(c) Gray Co has been an audit client since 1999 after your firm advised management on a successful buyout. Gray
provides communication services and software solutions. Your firm provides Gray with technical advice on
financial reporting and tax services. Most recently you have been asked to conduct due diligence reviews on
potential acquisitions.
Required:
For these assignments, compare and contrast:
(i) the threats to independence;
(ii) the other professional and practical matters that arise; and
(iii) the implications for allocating staff.
(15 marks)
正确答案：
5 FOX & STEEPLE – THREE AUDIT ASSIGNMENTS
(i) Threats to independence
Self-interest
Tutorial note: This threat arises when a firm or a member of the audit team could benefit from a financial interest in, or
other self-interest conflict with, an assurance client.
■ A self-interest threat could potentially arise in respect of any (or all) of these assignments as, regardless of any fee
restrictions (e.g. per IFAC’s ‘Code of Ethics for Professional Accountants’), the auditor is remunerated by clients for
services provided.
■ This threat is likely to be greater for Huggins Co (larger/listed) and Gray Co (requires other services) than for Blythe Co
(audit a statutory necessity).
■ The self-interest threat may be greatest for Huggins Co. As a company listed on a recognised stock exchange it may
give prestige and credibility to Fox & Steeple (though this may be reciprocated). Fox & Steeple could be pressurised into
taking evasive action to avoid the loss of a listed client (e.g. concurring with an inappropriate accounting treatment).
Self-review
Tutorial note: This arises when, for example, any product or judgment of a previous engagement needs to be re-evaluated
in reaching conclusions on the audit engagement.
■ This threat is also likely to be greater for Huggins and Gray where Fox & Steeple is providing other (non-audit) services.
■ A self-review threat may be created by Fox & Steeple providing Huggins with a ‘thorough examination’ of its computerised
systems if it involves an extension of the procedures required to conduct an audit in accordance with International
Standards on Auditing (ISAs).
■ Appropriate safeguards must be put in place if Fox & Steeple assists Huggins in the performance of internal audit
activities. In particular, Fox & Steeple’s personnel must not act (or appear to act) in a capacity equivalent to a member
of Huggins’ management (e.g. reporting, in a management role, to those charged with governance).
■ Fox & Steeple may provide Gray with accounting and bookkeeping services, as Gray is not a listed entity, provided that
any self-review threat created is reduced to an acceptable level. In particular, in giving technical advice on financial
reporting, Fox & Steeple must take care not to make managerial decisions such as determining or changing journal
entries without obtaining Gray’s approval.
■ Taxation services comprise a broad range of services, including compliance, planning, provision of formal taxation
opinions and assistance in the resolution of tax disputes. Such assignments are generally not seen to create threats to
independence.
Tutorial note: It is assumed that the provision of tax services is permitted in the jurisdiction (i.e. that Fox and Steeple
are not providing such services if prohibited).
■ The due diligence reviews for Gray may create a self-review threat (e.g. on the fair valuation of net assets acquired).
However, safeguards may be available to reduce these threats to an acceptable level.
■ If staff involved in providing other services are also assigned to the audit, their work should be reviewed by more senior
staff not involved in the provision of the other services (to the extent that the other service is relevant to the audit).
■ The reporting lines of any staff involved in the audit of Huggins and the provision of other services for Huggins should
be different. (Similarly for Gray.)
Familiarity
Tutorial note: This arises when, by virtue of a close relationship with an audit client (or its management or employees) an
audit firm (or a member of the audit team) becomes too sympathetic to the client’s interests.
■ Long association of a senior member of an audit team with an audit client may create a familiarity threat. This threat
is likely to be greatest for Huggins, a long-standing client. It may also be significant for Gray as Fox & Steeple have had
dealings with this client for seven years now.
■ As Blythe is a new audit client this particular threat does not appear to be relevant.
■ Senior personnel should be rotated off the Huggins and Gray audit teams. If this is not possible (for either client), an
additional professional accountant who was not a member of the audit team should be required to independently review
the work done by the senior personnel.
■ The familiarity threat of using the same lead engagement partner on an audit over a prolonged period is particularly
relevant to Huggins, which is now a listed entity. IFAC’s ‘Code of Ethics for Professional Accountants’ requires that the
lead engagement partner should be rotated after a pre-defined period, normally no more than seven years. Although it
might be time for the lead engagement partner of Huggins to be changed, the current lead engagement partner may
continue to serve for the 2006 audit.
Tutorial note: Two additional years are permitted when an existing client becomes listed, since it may not be in the
client’s best interests to have an immediate rotation of engagement partner.
Intimidation
Tutorial note: This arises when a member of the audit team may be deterred from acting objectively and exercising
professional skepticism by threat (actual or perceived), from the audit client.
■ This threat is most likely to come from Blythe as auditors are threatened with a tendering process to keep fees down.
■ Peter may have already applied pressure to reduce inappropriately the extent of audit work performed in order to reduce
fees, by stipulating that there should not be an interim audit.
■ The audit senior allocated to Blythe will need to be experienced in standing up to client management personnel such as
Peter.
Tutorial note: ‘Correct’ classification under ‘ethical’, ‘other professional’, ‘practical’ or ‘staff implications’ is not as important
as identifying the matters.
(ii) Other professional and practical matters
Tutorial note: ‘Other professional’ includes quality control.
■ The experience of staff allocated to each assignment should be commensurate with the assessment of associated risk.
For example, there may be a risk that insufficient audit evidence is obtained within the budget for the audit of Blythe.
Huggins, as a listed client, carries a high reputational risk.
■ Sufficient appropriate staff should be allocated to each audit to ensure adequate quality control (in particular in the
direction, supervision, review of each assignment). It may be appropriate for a second partner to be assigned to carry
out a ‘hot review’ (before the auditor’s report is signed) of:
– Blythe, because it is the first audit of a new client; and
– Huggins, as it is listed.
■ Existing clients (Huggins and Gray) may already have some expectation regarding who should be assigned to their
audits. There is no reason why there should not be some continuity of staff providing appropriate safeguards are put in
place (e.g. to overcome any familiarity threat).
■ Senior staff assigned to Blythe should be alerted to the need to exercise a high degree of professional skepticism (in the
light of Peter’s attitude towards the audit).
■ New staff assigned to Huggins and Gray would perhaps be less likely to assume unquestioned honesty than staff
previously involved with these audits.
Logistics (practical)
■ All three assignments have the same financial year end, therefore there will be an element of ‘competition’ for the staff
to be assigned to the year-end visits and final audit assignments. As a listed company, Huggins is likely to have the
tightest reporting deadline and so have a ‘priority’ for staff.
■ Blythe is a local and private company. Staff involved in the year-end visit (e.g. to attend the physical inventory count)
should also be involved in the final audit. As this is a new client, staff assigned to this audit should get involved at every
stage to increase their knowledge and understanding of the business.
■ Huggins is a national operation and may require numerous staff to attend year-end procedures. It would not be expected
that all staff assigned to year-end visits should all be involved in the final audit.
Time/fee/staff budgets
■ Time budgets will need to be prepared for each assignment to determine manpower requirements (and to schedule audit
work).
(iii) Implications for allocating staff
■ Fox & Steeple should allocate staff so that those providing other services to Huggins and Gray (that may create a selfreview
threat) do not participate in the audit engagement.
Competence and due care (Qualifications/Specialisation)
■ All audit assignments will require competent staff.
■ Huggins will require staff with an in-depth knowledge of their computerised system.
■ Gray will require senior audit staff to be experienced in financial reporting matters specific to communications and
software solutions (e.g. in revenue recognition issues and accounting for internally-generated intangible assets).
■ Specialists providing tax services and undertaking the due diligence reviews for Gray may not be required to have any
involvement in the audit assignment. -
第2题：
(b) As a newly-qualified Chartered Certified Accountant in Boleyn & Co, you have been assigned to assist the ethics
partner in developing ethical guidance for the firm. In particular, you have been asked to draft guidance on the
following frequently asked questions (‘FAQs’) that will be circulated to all staff through Boleyn & Co’s intranet:
(i) What Information Technology services can we offer to audit clients? (5 marks)
Required:
For EACH of the three FAQs, explain the threats to objectivity that may arise and the safeguards that should
be available to manage them to an acceptable level.
NOTE: The mark allocation is shown against each of the three questions.
正确答案：
(b) FAQs
(i) Information Technology (IT) services
The greatest threats to independence arise from the provision of any service which involves auditors in:
■ auditing their own work;
■ the decision-making process;
■ undertaking management functions of the client.
IT services potentially pose all these threats:
■ self-interest threat – on-going services that provide a large proportion of Boleyn’s annual fees will contribute to a
threat to objectivity;
■ self-review threat – e.g. when IT services provided involve (i) the supervision of the audit client’s employees in the
performance of their normal duties; or (ii) the origination of electronic data evidencing the occurrence of
transactions;
■ management threat – e.g. when the IT services involve making judgments and taking decisions that are properly
the responsibility of management.
Thus, services that involve the design and implementation of financial IT systems that are used to generate information
forming a significant part of a client’s accounting system or financial statements is likely to create significant ethical
threats.
Possible safeguards include:
■ disclosing and discussing fees with the client’s audit committees (or others charged with corporate governance);
■ the audit client providing a written acknowledgment (e.g. in an engagement letter) of its responsibility for:
– establishing and monitoring a system of internal controls;
– the operation of the system (hardware or software); and
– the data used or generated by the system;
■ the designation by the audit client of a competent employee (preferably within senior management) with
responsibility to make all management decisions regarding the design and implementation of the hardware or
software system;
■ evaluation of the adequacy and results of the design and implementation of the system by the audit client;
■ suitable allocation of work within the firm (i.e. staff providing the IT services not being involved in the audit
engagement and having different reporting lines); and
■ review of the audit opinion by an audit partner who is not involved in the audit engagement.
Services in connection with the assessment, design and implementation of internal accounting controls and risk
management controls are not considered to create a threat to independence provided that the firm’s personnel do not
perform. management functions.
It would be acceptable to provide IT services to an audit client where the systems are not important to any significant
part of the accounting system or the production of financial statements and do not have significant reliance placed on
them by the auditors, provided that:
■ a member of the client’s management has been designated to receive and take responsibility for the results of the
IT work undertaken; and
■ appropriate safeguards are put in place (e.g. using separate partners and staff for each role and review by a partner
not involved in the audit engagement).
It would also generally be acceptable to provide and install off-the-shelf accounting packages to an audit client. -
第3题：
(b) As a newly-qualified Chartered Certified Accountant, you have been asked to write an ‘ethics column’ for a trainee
accountant magazine. In particular, you have been asked to draft guidance on the following questions addressed
to the magazine’s helpline:
(i) What gifts or hospitality are acceptable and when do they become an inducement? (5 marks)
Required:
For each of the three questions, explain the threats to objectivity that may arise and the safeguards that
should be available to manage them to an acceptable level.
NOTE: The mark allocation is shown against each of the three questions above.
正确答案：
(b) Draft guidance
(i) Gifts and hospitality
Gifts and hospitality may be offered as an inducement i.e. to unduly influence actions or decisions, encourage illegal or
dishonest behaviour or to obtain confidential information. An offer of gifts and/or hospitality from a client ordinarily gives
rise to threats to compliance with the fundamental principles, for example:
■ self-interest threats to objectivity and/or confidentiality may be created if a gift from a client is accepted;
■ intimidation threats to objectivity and/or confidentiality may arise through the possibility of such offers being made
public and damaging the reputation of the professional accountant (or close family member).
The significance of such threats will depend on the nature, value and intent behind the offer. There may be no significant
threat to compliance with the fundamental principles if a reasonable and informed third party would consider gifts and
hospitality to be clearly insignificant. For example, if the offer of gifts or hospitality is made in the normal course of
business without the specific intent to influence decision making or to obtain information.
If evaluated threats are other than clearly insignificant, safeguards should be considered and applied as necessary to
eliminate them or reduce them to an acceptable level.
Offers of gifts and hospitality should not be accepted if the threats cannot be eliminated or reduced to an acceptable
level through the application of safeguards.
As the real or apparent threats to compliance with the fundamental principles do not merely arise from acceptance of
an inducement but, sometimes, merely from the fact of the offer having been made, additional safeguards should be
adopted. For example:
■ immediately informing higher levels of management or those charged with governance that an inducement has
been offered;
■ informing third parties (e.g. a professional body) of the offer (after seeking legal advice);
■ advising immediate or close family members of relevant threats and safeguards where they are potentially in
positions that might result in offers of inducements (e.g. as a result of their employment situation); and
■ informing higher levels of management or those charged with governance where immediate or close family
members are employed by competitors or potential suppliers of that organisation. -
第4题：
4 You are an audit manager in Nate & Co, a firm of Chartered Certified Accountants. You are reviewing three situations,
which were recently discussed at the monthly audit managers’ meeting:
(1) Nate & Co has recently been approached by a potential new audit client, Fisher Co. Your firm is keen to take the
appointment and is currently carrying out client acceptance procedures. Fisher Co was recently incorporated by
Marcellus Fisher, with its main trade being the retailing of wooden storage boxes.
(2) Nate & Co provides the audit service to CF Co, a national financial services organisation. Due to a number of
errors in the recording of cash deposits from new customers that have been discovered by CF Co’s internal audit
team, the directors of CF Co have requested that your firm carry out a review of the financial information
technology systems. It has come to your attention that while working on the audit planning of CF Co, Jin Sayed,
one of the juniors on the audit team, who is a recent information technology graduate, spent three hours
providing advice to the internal audit team about how to improve the system. As far as you know, this advice has
not been used by the internal audit team.
(3) LA Shots Co is a manufacturer of bottled drinks, and has been an audit client of Nate & Co for five years. Two
audit juniors attended the annual inventory count last Monday. They reported that Brenda Mangle, the new
production manager of LA Shots Co, wanted the inventory count and audit procedures performed as quickly as
possible. As an incentive she offered the two juniors ten free bottles of ‘Super Juice’ from the end of the
production line. Brenda also invited them to join the LA Shots Co office party, which commenced at the end of
the inventory count. The inventory count and audit procedures were completed within two hours (the previous
year’s procedures lasted a full day), and the juniors then spent four hours at the office party.
Required:
(a) Define ‘money laundering’ and state the procedures specific to money laundering that should be considered
before, and on the acceptance of, the audit appointment of Fisher Co. (5 marks)
正确答案：
4 NATE & CO
(a) – Money laundering is the process by which criminals attempt to conceal the true origin and ownership of the proceeds
of criminal activity, allowing them to maintain control over the proceeds, and ultimately providing a legitimate cover for
their sources of income. The objective of money laundering is to break the connection between the money, and the crime
that it resulted from.
– It is widely defined, to include possession of, or concealment of, the proceeds of any crime.
– Examples include proceeds of fraud, tax evasion and benefits of bribery and corruption.
Client procedures should include the following:
– Client identification:
? Establish the identity of the entity and its business activity e.g. by obtaining a certificate of incorporation
? If the client is an individual, obtain official documentation including a name and address, e.g. by looking at
photographic identification such as passports and driving licences
? Consider whether the commercial activity makes business sense (i.e. it is not just a ‘front’ for illegal activities)
? Obtain evidence of the company’s registered address e.g. by obtaining headed letter paper
? Establish the current list of principal shareholders and directors.
– Client understanding:
? Pre-engagement communication may be considered, to explain to Marcellus Fisher and the other directors the
nature and reason for client acceptance procedures.
? Best practice recommends that the engagement letter should also include a paragraph outlining the auditor’s
responsibilities in relation to money laundering. -
第5题：
4 You are a senior manager in Becker & Co, a firm of Chartered Certified Accountants offering audit and assurance
services mainly to large, privately owned companies. The firm has suffered from increased competition, due to two
new firms of accountants setting up in the same town. Several audit clients have moved to the new firms, leading to
loss of revenue, and an over staffed audit department. Bob McEnroe, one of the partners of Becker & Co, has asked
you to consider how the firm could react to this situation. Several possibilities have been raised for your consideration:
1. Murray Co, a manufacturer of electronic equipment, is one of Becker & Co’s audit clients. You are aware that the
company has recently designed a new product, which market research indicates is likely to be very successful.
The development of the product has been a huge drain on cash resources. The managing director of Murray Co
has written to the audit engagement partner to see if Becker & Co would be interested in making an investment
in the new product. It has been suggested that Becker & Co could provide finance for the completion of the
development and the marketing of the product. The finance would be in the form. of convertible debentures.
Alternatively, a joint venture company in which control is shared between Murray Co and Becker & Co could be
established to manufacture, market and distribute the new product.
2. Becker & Co is considering expanding the provision of non-audit services. Ingrid Sharapova, a senior manager in
Becker & Co, has suggested that the firm could offer a recruitment advisory service to clients, specialising in the
recruitment of finance professionals. Becker & Co would charge a fee for this service based on the salary of the
employee recruited. Ingrid Sharapova worked as a recruitment consultant for a year before deciding to train as
an accountant.
3. Several audit clients are experiencing staff shortages, and it has been suggested that temporary staff assignments
could be offered. It is envisaged that a number of audit managers or seniors could be seconded to clients for
periods not exceeding six months, after which time they would return to Becker & Co.
Required:
Identify and explain the ethical and practice management implications in respect of:
(a) A business arrangement with Murray Co. (7 marks)
正确答案：
4 Becker & Co
(a) Joint business arrangement
The business opportunity in respect of Murray Co could be lucrative if the market research is to be believed.
However, IFAC’s Code of Ethics for Professional Accountants states that a mutual business arrangement is likely to give rise
to self-interest and intimidation threats to independence and objectivity. The audit firm must be and be seen to be independent
of the audit client, which clearly cannot be the case if the audit firm and the client are seen to be working together for a
mutual financial gain.
In the scenario, two options are available. Firstly, Becker & Co could provide the audit client with finance to complete the
development and take the product to market. There is a general prohibition on audit firms providing finance to their audit
clients. This would create a clear financial self-interest threat as the audit firm would be receiving a return on investment from
their client. The Code states that if a firm makes a loan (or guarantees a loan) to a client, the self-interest threat created would
be so significant that no safeguard could reduce the threat to an acceptable level.
The provision of finance using convertible debentures raises a further ethical problem, because if the debentures are ultimately
converted to equity, the audit firm would then hold equity shares in their audit client. This is a severe financial self-interest,
which safeguards are unlikely to be able to reduce to an acceptable level.
The finance should not be advanced to Murray Co while the company remains an audit client of Becker & Co.
The second option is for a joint venture company to be established. This would be perceived as a significant mutual business
interest as Becker & Co and Murray Co would be investing together, sharing control and sharing a return on investment in
the form. of dividends. IFAC’s Code of Ethics states that unless the relationship between the two parties is clearly insignificant,
the financial interest is immaterial, and the audit firm is unable to exercise significant influence, then no safeguards could
reduce the threat to an acceptable level. In this case Becker & Co may not enter into the joint venture arrangement while
Murray Co is still an audit client.
The audit practice may consider that investing in the new electronic product is a commercial strategy that it wishes to pursue,
either through loan finance or using a joint venture arrangement. In this case the firm should resign as auditor with immediate
effect in order to eliminate any ethical problem with the business arrangement. The partners should carefully consider if the
potential return on investment will more than compensate for the lost audit fee from Murray Co.
The partners should also reflect on whether they want to diversify to such an extent – this investment is unlikely to be in an
area where any of the audit partners have much knowledge or expertise. A thorough commercial evaluation and business risk
analysis must be performed on the new product to ensure that it is a sound business decision for the firm to invest.
The audit partners should also consider how much time they would need to spend on this business development, if they
decided to resign as auditors and to go ahead with the investment. Such a new and important project could mean that they
take their focus off the key business i.e. the audit practice. They should consider if it would be better to spend their time trying
to compete effectively with the two new firms of accountants, trying to retain key clients, and to attract new accounting and
audit clients rather than diversify into something completely different. -
第6题：
You are an audit manager responsible for providing hot reviews on selected audit clients within your firm of Chartered
Certified Accountants. You are currently reviewing the audit working papers for Pulp Co, a long standing audit client,
for the year ended 31 January 2008. The draft statement of financial position (balance sheet) of Pulp Co shows total
assets of $12 million (2007 – $11·5 million).The audit senior has made the following comment in a summary of
issues for your review:
‘Pulp Co’s statement of financial position (balance sheet) shows a receivable classified as a current asset with a value
of $25,000. The only audit evidence we have requested and obtained is a management representation stating the
following:
(1) that the amount is owed to Pulp Co from Jarvis Co,
(2) that Jarvis Co is controlled by Pulp Co’s chairman, Peter Sheffield, and
(3) that the balance is likely to be received six months after Pulp Co’s year end.
The receivable was also outstanding at the last year end when an identical management representation was provided,
and our working papers noted that because the balance was immaterial no further work was considered necessary.
No disclosure has been made in the financial statements regarding the balance. Jarvis Co is not audited by our firm
and we have verified that Pulp Co does not own any shares in Jarvis Co.’
Required:
(b) In relation to the receivable recognised on the statement of financial position (balance sheet) of Pulp Co as
at 31 January 2008:
(i) Comment on the matters you should consider. (5 marks)
正确答案：
(b) (i) Matters to consider
Materiality
The receivable represents only 0·2% (25,000/12 million x 100) of total assets so is immaterial in monetary terms.
However, the details of the transaction could make it material by nature.
The amount is outstanding from a company under the control of Pulp Co’s chairman. Readers of the financial statements
would be interested to know the details of this transaction, which currently is not disclosed. Elements of the transaction
could be subject to bias, specifically the repayment terms, which appear to be beyond normal commercial credit terms.
Paul Sheffield may have used his influence over the two companies to ‘engineer’ the transaction. Disclosure is necessary
due to the nature of the transaction, the monetary value is irrelevant.
A further matter to consider is whether this is a one-off transaction, or indicative of further transactions between the two
companies.
Relevant accounting standard
The definitions in IAS 24 must be carefully considered to establish whether this actually constitutes a related party
transaction. The standard specifically states that two entities are not necessarily related parties just because they have
a director or other member of key management in common. The audit senior states that Jarvis Co is controlled by Peter
Sheffield, who is also the chairman of Pulp Co. It seems that Peter Sheffield is in a position of control/significant influence
over the two companies (though this would have to be clarified through further audit procedures), and thus the two
companies are likely to be perceived as related.
IAS 24 requires full disclosure of the following in respect of related party transactions:
– the nature of the related party relationship,
– the amount of the transaction,
– the amount of any balances outstanding including terms and conditions, details of security offered, and the nature
of consideration to be provided in settlement,
– any allowances for receivables and associated expense.
There is currently a breach of IAS 24 as no disclosure has been made in the notes to the financial statements. If not
amended, the audit opinion on the financial statements should be qualified with an ‘except for’ disagreement. In
addition, if practicable, the auditor’s report should include the information that would have been included in the financial
statements had the requirements of IAS 24 been adhered to.
Valuation and classification of the receivable
A receivable should only be recognised if it will give rise to future economic benefit, i.e. a future cash inflow. It appears
that the receivable is long outstanding – if the amount is unlikely to be recovered then it should be written off as a bad
debt and the associated expense recognised. It is possible that assets and profits are overstated.
Although a representation has been received indicating that the amount will be paid to Pulp Co, the auditor should be
sceptical of this claim given that the same representation was given last year, and the amount was not subsequently
recovered. The $25,000 could be recoverable in the long term, in which case the receivable should be reclassified as
a non-current asset. The amount advanced to Jarvis Co could effectively be an investment rather than a short term
receivable. Correct classification on the statement of financial position (balance sheet) is crucial for the financial
statements to properly show the liquidity position of the company at the year end.
Tutorial note: Digressions into management imposing a limitation in scope by withholding evidence are irrelevant in this
case, as the scenario states that the only evidence that the auditors have asked for is a management representation.
There is no indication in the scenario that the auditors have asked for, and been refused any evidence. -
第7题：
Considering your financial situations, which we realize have not been good recently, we have not () you for payment.
A、compressed
B、pressured
C、pressed
D、stessed
参考答案：C
-
第8题：
Write a memo in about 50 words. You are the Personnel Manager of a company, and have been approached by your IT Department to recruit three new members of staff. Write a memo to Miss Kate Bush, the Manager of the IT Department, ·informing her you have received over 100 applications and have selected 10 candidates for interview, ·telling her you will write to the candidates inviting them for interview, and ·asking her to tell you the time and the place of the interview.
To: Miss Kate Bush
From: your name, Personnel Manager
Subject: IT Department job interview
Date: April 18, 2013
I have received over 100 applications for the three new positions in the IT Department and have put together a short list of 10 candidates. I will shortly write to the candidates inviting them for interview. Please let me know when and where you would like the interview to take place so that I can inform the candidates when I write to them.
略 -
第9题：
You （）him so closely; you should have kept your distance．
- A、shouldn’tfollow
- B、mustn’tfollow
- C、couldn’t have been following
- D、shouldn’t have been following
正确答案:D -
第10题：
You work as an administrator at ABC.com. The ABC.com network consists of a single domain named ABC.com. All servers in the ABC.com domain， including domain controllers， have Windows Server 2012 R2 installed.You have been instructed to add a new domain controller to ABC.com’s existing environment. Which of the following actions should you take？（）
- A、You should consider making use of Server Manager.
- B、You should consider making use of Authorization Manager.
- C、You should consider making use of Remote Desktop Gateway Manager.
- D、You should consider making use of Network Load Balancing Manager.
正确答案:A -
第11题：
单选题You have been recently hired as a database administrator. Your senior manager asks you to study the production database server and submit a report on the settings done by the previous DBA. While observing the server settings， you find that the following parameter has been set in the parameter file of the database： REMOTE_OS_AUTHENT = TRUE What could have been the reason to set this parameter as TRUE？（）Ato enable operating system authentication for a remote client
Bto restrict the scope of administration to identical operating systems
Cto allow the start up and shut down of the database from a remote client
Dto enable the administration of the operating system from a remote client
Eto disable the administration of the operating system from a remote client
正确答案： A解析： 暂无解析 -
第12题：
问答题Write a memo in about 50 words. You are the Personnel Manager of a company, and have been approached by your IT Department to recruit three new members of staff. Write a memo to Miss Kate Bush, the Manager of the IT Department, ·informing her you have received over 100 applications and have selected 10 candidates for interview, ·telling her you will write to the candidates inviting them for interview, and ·asking her to tell you the time and the place of the interview.正确答案： To: Miss Kate Bush
From: your name, Personnel Manager
Subject: IT Department job interview
Date: April 18, 2013
I have received over 100 applications for the three new positions in the IT Department and have put together a short list of 10 candidates. I will shortly write to the candidates inviting them for interview. Please let me know when and where you would like the interview to take place so that I can inform the candidates when I write to them.解析： 暂无解析 -
第13题：
(b) You are an audit manager in a firm of Chartered Certified Accountants currently assigned to the audit of Cleeves
Co for the year ended 30 September 2006. During the year Cleeves acquired a 100% interest in Howard Co.
Howard is material to Cleeves and audited by another firm, Parr & Co. You have just received Parr’s draft
auditor’s report for the year ended 30 September 2006. The wording is that of an unmodified report except for
the opinion paragraph which is as follows:
Audit opinion
As more fully explained in notes 11 and 15 impairment losses on non-current assets have not been
recognised in profit or loss as the directors are unable to quantify the amounts.
In our opinion, provision should be made for these as required by International Accounting Standard 36
(Impairment). If the provision had been so recognised the effect would have been to increase the loss before
and after tax for the year and to reduce the value of tangible and intangible non-current assets. However,
as the directors are unable to quantify the amounts we are unable to indicate the financial effect of such
omissions.
In view of the failure to provide for the impairments referred to above, in our opinion the financial statements
do not present fairly in all material respects the financial position of Howard Co as of 30 September 2006
and of its loss and its cash flows for the year then ended in accordance with International Financial Reporting
Standards.
Your review of the prior year auditor’s report shows that the 2005 audit opinion was worded identically.
Required:
(i) Critically appraise the appropriateness of the audit opinion given by Parr & Co on the financial
statements of Howard Co, for the years ended 30 September 2006 and 2005. (7 marks)
正确答案：(b) (i) Appropriateness of audit opinion given
Tutorial note: The answer points suggested by the marking scheme are listed in roughly the order in which they might
be extracted from the information presented in the question. The suggested answer groups together some of these
points under headings to give the analysis of the situation a possible structure.
Heading
■ The opinion paragraph is not properly headed. It does not state the form. of the opinion that has been given nor
the grounds for qualification.
■ The opinion ‘the financial statements do not give a true and fair view’ is an ‘adverse’ opinion.
■ That ‘provision should be made’, but has not, is a matter of disagreement that should be clearly stated as noncompliance
with IAS 36. The title of IAS 36 Impairment of Assets should be given in full.
■ The opinion should be headed ‘Disagreement on Accounting Policies – Inappropriate Accounting Method – Adverse
Opinion’.
1 ISA 250 does not specify with whom agreement should be reached but presumably with those charged with corporate governance (e.g audit committee or
2 other supervisory board).
20
6D–INTBA
Paper 3.1INT
Content
■ It is appropriate that the opinion paragraph should refer to the note(s) in the financial statements where the matter
giving rise to the modification is more fully explained. However, this is not an excuse for the audit opinion being
‘light’ on detail. For example, the reason for impairment could be summarised in the auditor’s report.
■ The effects have not been quantified, but they should be quantifiable. The maximum possible loss would be the
carrying amount of the non-current assets identified as impaired.
■ It is not clear why the directors have been ‘unable to quantify the amounts’. Since impairments should be
quantifiable any ‘inability’ suggest a limitation in scope of the audit, in which case the opinion should be disclaimed
(or ‘except for’) on grounds of lack of evidence rather than disagreement.
■ The wording is confusing. ‘Failure to provide’ suggests disagreement. However, there must be sufficient evidence
to support any disagreement. Although the directors cannot quantify the amounts it seems the auditors must have
been able to (estimate at least) in order to form. an opinion that the amounts involved are sufficiently material to
warrant a qualification.
■ The first paragraph refers to ‘non-current assets’. The second paragraph specifies ‘tangible and intangible assets’.
There is no explanation why or how both tangible and intangible assets are impaired.
■ The first paragraph refers to ‘profit or loss’ and the second and third paragraphs to ‘loss’. It may be clearer if the
first paragraph were to refer to recognition in the income statement.
■ It is not clear why the failure to recognise impairment warrants an adverse opinion rather than ‘except for’. The
effects of non-compliance with IAS 36 are to overstate the carrying amount(s) of non-current assets (that can be
specified) and to understate the loss. The matter does not appear to be pervasive and so an adverse opinion looks
unsuitable as the financial statements as a whole are not incomplete or misleading. A loss is already being reported
so it is not that a reported profit would be turned into a loss (which is sometimes judged to be ‘pervasive’).
Prior year
■ As the 2005 auditor’s report, as previously issued, included an adverse opinion and the matter that gave rise to
the modification:
– is unresolved; and
– results in a modification of the 2006 auditor’s report,
the 2006 auditor’s report should also be modified regarding the corresponding figures (ISA 710 Comparatives).
■ The 2006 auditor’s report does not refer to the prior period modification nor highlight that the matter resulting in
the current period modification is not new. For example, the report could say ‘As previously reported and as more
fully explained in notes ….’ and state ‘increase the loss by $x (2005 – $y)’. -
第14题：
3 You are the manager responsible for the audit of Lamont Co. The company’s principal activity is wholesaling frozen
fish. The draft consolidated financial statements for the year ended 31 March 2007 show revenue of $67·0 million
(2006 – $62·3 million), profit before taxation of $11·9 million (2006 – $14·2 million) and total assets of
$48·0 million (2006 – $36·4 million).
The following issues arising during the final audit have been noted on a schedule of points for your attention:
(a) In early 2007 a chemical leakage from refrigeration units owned by Lamont caused contamination of some of its
property. Lamont has incurred $0·3 million in clean up costs, $0·6 million in modernisation of the units to
prevent future leakage and a $30,000 fine to a regulatory agency. Apart from the fine, which has been expensed,
these costs have been capitalised as improvements. (7 marks)
Required:
For each of the above issues:
(i) comment on the matters that you should consider; and
(ii) state the audit evidence that you should expect to find,
in undertaking your review of the audit working papers and financial statements of Lamont Co for the year ended
31 March 2007.
NOTE: The mark allocation is shown against each of the three issues.
正确答案：
3 LAMONT CO
(a) Chemical leakage
(i) Matters
■ $30,000 fine is very immaterial (just 1/4% profit before tax). This is revenue expenditure and it is correct that it
has been expensed to the income statement.
■ $0·3 million represents 0·6% total assets and 2·5% profit before tax and is not material on its own. $0·6 million
represents 1·2% total assets and 5% profit before tax and is therefore material to the financial statements.
■ The $0·3 million clean-up costs should not have been capitalised as the condition of the property is not improved
as compared with its condition before the leakage occurred. Although not material in isolation this amount should
be adjusted for and expensed, thereby reducing the aggregate of uncorrected misstatements.
■ It may be correct that $0·6 million incurred in modernising the refrigeration units should be capitalised as a major
overhaul (IAS 16 Property, Plant and Equipment). However, any parts scrapped as a result of the modernisation
should be treated as disposals (i.e. written off to the income statement).
■ The carrying amount of the refrigeration units at 31 March 2007, including the $0·6 million for modernisation,
should not exceed recoverable amount (i.e. the higher of value in use and fair value less costs to sell). If it does,
an allowance for the impairment loss arising must be recognised in accordance with IAS 36 Impairment of Assets.
(ii) Audit evidence
■ A breakdown/analysis of costs incurred on the clean-up and modernisation amounting to $0·3 million and
$0·6 million respectively.
■ Agreement of largest amounts to invoices from suppliers/consultants/sub-contractors, etc and settlement thereof
traced from the cash book to the bank statement.
■ Physical inspection of the refrigeration units to confirm their modernisation and that they are in working order. (Do
they contain frozen fish?)
■ Sample of components selected from the non-current asset register traced to the refrigeration units and inspected
to ensure continuing existence.
■ $30,000 penalty notice from the regulatory agency and corresponding cash book payment/payment per the bank
statement.
■ Written management representation that there are no further penalties that should be provided for or disclosed other
than the $30,000 that has been accounted for. -
第15题：
3 You are an audit manager in Webb & Co, a firm of Chartered Certified Accountants. Your audit client, Mulligan Co,
designs and manufactures wooden tables and chairs. The business has expanded rapidly in the last two years, since
the arrival of Patrick Tiler, an experienced sales and marketing manager.
The directors want to secure a loan of $3 million in order to expand operations, following the design of a completely
new range of wooden garden furniture. The directors have approached LCT Bank for the loan. The bank’s lending
criteria stipulate the following:
‘Loan applications must be accompanied by a detailed business plan, including an analysis of how the finance will
be used. LCT Bank need to see that the finance requested is adequate for the proposed business purpose. The
business plan must be supported by an assurance opinion on the adequacy of the requested finance.’
The $3 million finance raised will be used as follows:
$000
Construction of new factory 1,250
Purchase of new machinery 1,000
Initial supply of timber raw material 250
Advertising and marketing of new product 500
Your firm has agreed to review the business plan and to provide an assurance opinion on the completeness of the
finance request. A meeting will be held tomorrow to discuss this assignment.
Required:
(a) Identify and explain the matters relating to the assurance assignment that should be discussed at the meeting
with Mulligan Co. (8 marks)
正确答案：
3 MULLIGAN CO
(a) Matters to be discussed would include the following:
The exact content of the business plan which could include:
– Description of past business performance and key products
– Discussion of the new product
– Evidence of the marketability of the new product
– Cash flow projections
– Capital expenditure forecasts
– Key business assumptions.
The form. of the assurance report that is required – in an assurance engagement the nature and wording of the expected
opinion should be discussed. Webb & Co should clarify that an opinion of ‘negative assurance’ will be required, and whether
this will meet the bank’s lending criteria.
The intended recipient of the report – Webb & Co need to clarify the name and address of the recipient at LCT Bank. For the
limitation of professional liability, it should be clarified that LCT Bank will be the only recipient, and that the assurance opinion
is being used only as part of the bank’s overall lending decision.
Limiting liability – Webb & Co may want to receive in writing a statement that the report is for information purposes only, and
does not give rise to any responsibility, liability, duty or obligation from the firm to the lender.
Deadlines – it should be discussed when the bank need the report. This in turn will be influenced by when Mulligan Co needs
the requested $3 million finance. The bank may need a considerable period of time to assess the request, review the report,
and ensure that their lending criteria have been fully met prior to advancing the finance.
Availability of evidence – Mulligan Co should be made aware that in order to express an opinion on the finance request, they
must be prepared to provide all the necessary paperwork to assist the assurance provider. Evidence is likely to include
discussions with key management, and written representations of discussions may be required.
Professional regulation – Webb & Co should discuss the kind of procedures that will be undertaken, and confirm that they
will be complying with relevant professional guidance, for example:
– ISAE 3000 Assurance Engagements other than Audits or Reviews of Historical Financial Information
– ISAE 3400 The Examination of Prospective Financial Information
Engagement administration – any points not yet discussed in detail when deciding to take the assurance engagement should
be finalised at the meeting. These points could include the following:
– Fees – the total fee and billing arrangements must be agreed before any work is carried out
– Personnel – Webb & Co should identify the key personnel who will be involved in the assignment
– Complaints procedures – should be briefly outlined (the complaints procedures in an assurance engagement may differ
from an audit assignment)
– Engagement letter – if not already signed by both Webb & Co and Mulligan Co, the engagement letter should be
discussed and signed at the meeting before any assignment work is conducted.
Tutorial note: the scenario states that Webb & Co have already decided to take the assurance assignment for their existing
client, therefore the answer to this requirement should not focus on client or engagement acceptance procedures. -
第16题：
5 You are the audit manager for three clients of Bertie & Co, a firm of Chartered Certified Accountants. The financial
year end for each client is 30 September 2007.
You are reviewing the audit senior’s proposed audit reports for two clients, Alpha Co and Deema Co.
Alpha Co, a listed company, permanently closed several factories in May 2007, with all costs of closure finalised and
paid in August 2007. The factories all produced the same item, which contributed 10% of Alpha Co’s total revenue
for the year ended 30 September 2007 (2006 – 23%). The closure has been discussed accurately and fully in the
chairman’s statement and Directors’ Report. However, the closure is not mentioned in the notes to the financial
statements, nor separately disclosed on the financial statements.
The audit senior has proposed an unmodified audit opinion for Alpha Co as the matter has been fully addressed in
the chairman’s statement and Directors’ Report.
In October 2007 a legal claim was filed against Deema Co, a retailer of toys. The claim is from a customer who slipped
on a greasy step outside one of the retail outlets. The matter has been fully disclosed as a material contingent liability
in the notes to the financial statements, and audit working papers provide sufficient evidence that no provision is
necessary as Deema Co’s lawyers have stated in writing that the likelihood of the claim succeeding is only possible.
The amount of the claim is fixed and is adequately covered by cash resources.
The audit senior proposes that the audit opinion for Deema Co should not be qualified, but that an emphasis of matter
paragraph should be included after the audit opinion to highlight the situation.
Hugh Co was incorporated in October 2006, using a bank loan for finance. Revenue for the first year of trading is
$750,000, and there are hopes of rapid growth in the next few years. The business retails luxury hand made wooden
toys, currently in a single retail outlet. The two directors (who also own all of the shares in Hugh Co) are aware that
due to the small size of the company, the financial statements do not have to be subject to annual external audit, but
they are unsure whether there would be any benefit in a voluntary audit of the first year financial statements. The
directors are also aware that a review of the financial statements could be performed as an alternative to a full audit.
Hugh Co currently employs a part-time, part-qualified accountant, Monty Parkes, who has prepared a year end
balance sheet and income statement, and who produces summary management accounts every three months.
Required:
(a) Evaluate whether the audit senior’s proposed audit report is appropriate, and where you disagree with the
proposed report, recommend the amendment necessary to the audit report of:
(i) Alpha Co; (6 marks)
正确答案：
5 BERTIE & CO
(a) (i) Alpha Co
The factory closures constitute a discontinued operation per IFRS 5 Non-Current Assets Held for Sale and Discontinued
Operations, due to the discontinuance of a separate major component of the business. It is a major component due to
the 10% contribution to revenue in the year to 30 September 2007 and 23% contribution in 2006. It is a separate
business component of the company due to the factories having made only one item, indicating a separate income
generating unit.
Under IFRS 5 there must be separate disclosure on the face of the income statement of the post tax results of the
discontinued operation, and of any profit or loss resulting from the closures. The revenue and costs of the discontinued
operation should be separately disclosed either on the face of the income statement or in the notes to the financial
statements. Cash flows relating to the discontinued operation should also be separately disclosed per IAS 7 Cash Flow
Statements.
In addition, as Alpha Co is a listed company, IFRS 8 Operating Segments requires separate segmental disclosure of
discontinued operations.
Failure to disclose the above information in the financial statements is a material breach of International Accounting
Standards. The audit opinion should therefore be qualified on the grounds of disagreement on disclosure (IFRS 5,
IAS 7 and IFRS 8). The matter is material, but not pervasive, and therefore an ‘except for’ opinion should be issued.
The opinion paragraph should clearly state the reason for the disagreement, and an indication of the financial
significance of the matter.
The audit opinion relates only to the financial statements which have been audited, and the contents of the other
information (chairman’s statement and Directors’ Report) are irrelevant when deciding if the financial statements show
a true and fair view, or are fairly presented.
Tutorial note: there is no indication in the question scenario that Alpha Co is in financial or operational difficulty
therefore no marks are awarded for irrelevant discussion of going concern issues and the resultant impact on the audit
opinion. -
第17题：
(c) Maxwell Co is audited by Lead & Co, a firm of Chartered Certified Accountants. Leo Sabat has enquired as to
whether your firm would be prepared to conduct a joint audit in cooperation with Lead & Co, on the future
financial statements of Maxwell Co if the acquisition goes ahead. Leo Sabat thinks that this would enable your
firm to improve group audit efficiency, without losing the cumulative experience that Lead & Co has built up while
acting as auditor to Maxwell Co.
Required:
Define ‘joint audit’, and assess the advantages and disadvantages of the audit of Maxwell Co being conducted
on a ‘joint basis’. (7 marks)
正确答案：
(c) A joint audit is when two or more audit firms are jointly responsible for giving the audit opinion. This is very common in a
group situation where the principal auditor is appointed jointly with the auditor of a subsidiary to provide a joint opinion on
the subsidiary’s financial statements. There are several advantages and disadvantages in a joint audit being performed.
Advantages
It can be beneficial in terms of audit efficiency for a joint audit to be conducted, especially in the case of a new subsidiary.
In this case, Lead & Co will have built up an understanding of Maxwell Co’s business, systems and controls, and financial
statement issues. It will be time efficient for the two firms of auditors to work together in order for Chien & Co to build up
knowledge of the new subsidiary. This is a key issue, as Chien & Co need to acquire a thorough understanding of the
subsidiary in order to assess any risks inherent in the company which could impact on the overall assessment of risk within
the group. Lead & Co will be able to provide a good insight into the company, and advise Chien & Co of the key risk areas
they have previously identified.
On the practical side, it seems that Maxwell Co is a significant addition to the group, as it is expected to increase operating
facilities by 40%. If Chien & Co were appointed as sole auditors to Maxwell Co it may be difficult for the audit firm to provide
adequate resources to conduct the audit at the same time as auditing the other group companies. A joint audit will allow
sufficient resources to be allocated to the audit of Maxwell Co, assuring the quality of the opinion provided.
If there is a tight deadline, as is common with the audit of subsidiaries, which should be completed before the group audit
commences, then having access to two firms’ resources should enable the audit to be completed in good time.
The audit should also benefit from an improvement in quality. The two audit firms may have different points of view, and
would be able to discuss contentious issues throughout the audit process. In particular, the newly appointed audit team will
have a ‘fresh pair of eyes’ and be able to offer new insight to matters identified. It should be easier to challenge management
and therefore ensure that the auditors’ position is taken seriously.
Tutorial note: Candidates may have referred to the recent debate over whether joint audits increase competition in the
profession. In particular, joint audits have been proposed as a way for ‘mid tier’ audit firms to break into the market of
auditing large companies and groups, which at the moment is monopolised by the ‘Big 4’. Although this does not answer
the specific question set, credit will be awarded for demonstration of awareness of this topical issue.
Disadvantages
For the client, it is likely to be more expensive to engage two audit firms than to have the audit opinion provided by one firm.
From a cost/benefit point of view there is clearly no point in paying twice for one opinion to be provided. Despite the audit
workload being shared, both firms will have a high cost for being involved in the audit in terms of senior manager and partner
time. These costs will be passed on to the client within the audit fee.
The two audit firms may use very different audit approaches and terminology. This could make it difficult for the audit firms
to work closely together, negating some of the efficiency and cost benefits discussed above. Problems could arise in deciding
which firm’s method to use, for example, to calculate materiality, design and pick samples for audit procedures, or evaluate
controls within the accounting system. It may be impossible to reconcile two different methods and one firm’s methods may
end up dominating the audit process, which then eliminates the benefit of a joint audit being conducted. It could be time
consuming to develop a ‘joint’ audit approach, based on elements of each of the two firms’ methodologies, time which
obviously would not have been spent if a single firm was providing the audit.
There may be problems for the two audit firms to work together harmoniously. Lead & Co may feel that ultimately they will
be replaced by Chien & Co as audit provider, and therefore could be unwilling to offer assistance and help.
Potentially, problems could arise in terms of liability. In the event of litigation, because both firms have provided the audit
opinion, it follows that the firms would be jointly liable. The firms could blame each other for any negligence which was
discovered, making the litigation process more complex than if a single audit firm had provided the opinion. However, it could
be argued that joint liability is not necessarily a drawback, as the firms should both be covered by professional indemnity
insurance. -
第18题：
4 You are an audit manager in Smith & Co, a firm of Chartered Certified Accountants. You have recently been made
responsible for reviewing invoices raised to clients and for monitoring your firm’s credit control procedures. Several
matters came to light during your most recent review of client invoice files:
Norman Co, a large private company, has not paid an invoice from Smith & Co dated 5 June 2007 for work in respect
of the financial statement audit for the year ended 28 February 2007. A file note dated 30 November 2007 states
that Norman Co is suffering poor cash flows and is unable to pay the balance. This is the only piece of information
in the file you are reviewing relating to the invoice. You are aware that the final audit work for the year ended
28 February 2008, which has not yet been invoiced, is nearly complete and the audit report is due to be issued
imminently.
Wallace Co, a private company whose business is the manufacture of industrial machinery, has paid all invoices
relating to the recently completed audit planning for the year ended 31 May 2008. However, in the invoice file you
notice an invoice received by your firm from Wallace Co. The invoice is addressed to Valerie Hobson, the manager
responsible for the audit of Wallace Co. The invoice relates to the rental of an area in Wallace Co’s empty warehouse,
with the following comment handwritten on the invoice: ‘rental space being used for storage of Ms Hobson’s
speedboat for six months – she is our auditor, so only charge a nominal sum of $100’. When asked about the invoice,
Valerie Hobson said that the invoice should have been sent to her private address. You are aware that Wallace Co
sometimes uses the empty warehouse for rental income, though this is not the main trading income of the company.
In the ‘miscellaneous invoices raised’ file, an invoice dated last week has been raised to Software Supply Co, not a
client of your firm. The comment box on the invoice contains the note ‘referral fee for recommending Software Supply
Co to several audit clients regarding the supply of bespoke accounting software’.
Required:
Identify and discuss the ethical and other professional issues raised by the invoice file review, and recommend
what action, if any, Smith & Co should now take in respect of:
(a) Norman Co; (8 marks)
正确答案：
4 Smith & Co
(a) Norman Co
The invoice is 12 months old and it appears doubtful whether the amount outstanding is recoverable. The fact that such an
old debt is unsettled indicates poor credit control by Smith & Co. Part of good practice management is to run a profitable,
cash generating audit function. The debt should not have been left outstanding for such a long period. It seems that little has
been done to secure payment since the file note was attached to the invoice in November 2007.
There is also a significant ethical issue raised. Overdue fees are a threat to objectivity and independence. Due to Norman Co
not yet paying for the 2007 year end audit, it could be perceived that the audit has been performed for free. Alternatively the
amount outstanding could be perceived as a loan to the client, creating a self-interest threat to independence.
The audit work for the year ended 28 February 2008 should not have been carried out without some investigation into the
unpaid invoice relating to the prior year audit. This also represents a self-interest threat – if fees are not collected before the
audit report is issued, an unmodified report could be seen as enhancing the prospect of securing payment. It seems that a
check has not been made to see if the prior year fee has been paid prior to the audit commencing.
It is also concerning that the audit report for the 2008 year end is about to be issued, but no invoice has been raised relating
to the work performed. To maximise cash inflow, the audit firm should invoice the client as soon as possible for work
performed.
Norman Co appears to be suffering financial distress. In this case there is a valid commercial reason why payment has not
been made – the client simply lacks cash. While this fact does not eliminate the problems noted above, it means that the
auditors can continue so long as adequate ethical safeguards are put in place, and after the monetary significance of the
amount outstanding has been evaluated.
It should also be considered whether Norman Co’s financial situation casts any doubt over the going concern of the company.
Continued cash flow problems are certainly a financial indicator of going concern problems, and if the company does not
resolve the cash flow problem then it may be unable to continue in operational existence.
Action to be taken:
– Discuss with the audit committee (if any) or those charged with governance of Norman Co:
The ethical problems raised by the non-payment of invoices, and a payment programme to secure cash payment in
stages if necessary, rather than demanding the total amount outstanding immediately.
– Notify the ethics partner of Smith & Co of the situation – the ethics partner should evaluate the ethical threat posed by
the situation and document the decision to continue to act for Norman Co.
– The documentation should include an evaluation of the monetary significance of the amount outstanding, as it will be
more difficult to justify the continuance of the audit appointment if the amount is significant.
– The ethics partner should ensure that a firm-wide policy is communicated to all audit managers requiring them to check
the payment of previous invoices before commencing new client work. This check should be documented.
– Consider an independent partner review of the working papers prepared for the 28 February 2008 audit.
– The audit working papers on going concern should be reviewed to ensure that sufficient evidence has been gathered to
support the audit opinion. Further procedures may be found to be necessary given the continued cash flow problems.
– Smith & Co have already acted to improve credit control by making a manager responsible for reviewing invoices and
monitoring subsequent cash collection. It is important that credit control procedures are quickly put into place to prevent
similar situations arising. -
第19题：
Have you been to see your grandmother lately?A:lastly
B:finally
C:shortly
D:recently答案：D解析：lately：近来，最近。题干意思为：你最近有没有去看你的祖母？lastly：最后，终于；finally：最后，终于；shortly：不久，很快；recently：最近。经过分析，D选项正确。 -
第20题：
A:Hello, David! I haven't heard from you for a long time. How have you been recently? B:（）
AThat's ok
BLong time no see
CNot bad, thank you
C
略 -
第21题：
You have been recently hired as a database administrator. Your senior manager asks you to study the production database server and submit a report on the settings done by the previous DBA. While observing the server settings， you find that the following parameter has been set in the parameter file of the database： REMOTE_OS_AUTHENT = TRUE What could have been the reason to set this parameter as TRUE？（）
- A、to enable operating system authentication for a remote client
- B、to restrict the scope of administration to identical operating systems
- C、to allow the start up and shut down of the database from a remote client
- D、to enable the administration of the operating system from a remote client
- E、to disable the administration of the operating system from a remote client
正确答案:A -
第22题：
单选题John, how lazy you are! This work ______ three days ago.Ashould have done
Bmust have been done
Cshould have been done
Dmight have done
正确答案： C解析：
句意：这份工作本该三天前完成的。should have done表示应该做而没有做，含有责怪之意。must have done意为“一定做了”，表示肯定的推测。 -
第23题：
单选题You work as an administrator at ABC.com. The ABC.com network consists of a single domain named ABC.com. All servers in the ABC.com domain， including domain controllers， have Windows Server 2012 R2 installed.You have been instructed to add a new domain controller to ABC.com’s existing environment. Which of the following actions should you take？（）AYou should consider making use of Server Manager.
BYou should consider making use of Authorization Manager.
CYou should consider making use of Remote Desktop Gateway Manager.
DYou should consider making use of Network Load Balancing Manager.
正确答案： D解析： 暂无解析