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You are the audit manager for Cautious Counters. You are asked you to prepare a report covering the points below and how they are likely to affect the initial strategy adopted in the Audit Planning Memorandum.

October 31, 2015 0 Comment

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  1. a) You have been specifically asked to consider materiality and the factors which should be taken into account in its consideration.


  1. b) What other audit concepts are relevant?


  1. c) Audit risk is made up of inherent risk, control risk and detection risk. Outline the key risks of Cook Club and how you propose to mitigate these through the audit.


  1. d) Discuss the procedures which should be included in the audit work plan to cover the identified areas of audit risk. What recommendations would you make?


– Inventory

– Trade payables

– Revenue recognition


Ensure you cover the specific concerns Jilly Jones (the Finance Director of Cook Club)

has raised.


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