AAA_Study Guide Questions and Answers_3rd edition

AAA_Study Guide Questions and Answers_3rd edition




Study guide
Questions and Answers
ADVANCED AUDIT AND ASSURANCE

,AAA_Study Guide Questions and Answers_3rd edition
To be used in conjunction with Advanced Audit and Assurance, 3rd Edition.

,AAA_Study Guide Questions and Answers_3rd edition
ii | ADVANCED AUDIT AND ASSURANCE



Contents
Question 1.1 1
Question 1.2 2
Question 1.3 4
Question 1.4 5
Question 1.5 6
Question 1.6 7
Question 1.7 8
Question 1.8 9
Question 1.9 10
Question 1.10 11
Question 1.11 12
Question 1.12 13
Case study 1.1: Principles of professional conduct 14
Case study 1.2: Toe Ltd 20
Case study 1.3: Galaxy Ltd 21
Case study 1.4: Analyse Reading 1.1 23
Case study 1.5: Analyse Reading 1.2 26
Question 2.1 29
Question 2.2 30
Question 2.3 31
Question 2.4 32
Question 2.5 33
Question 2.6 37
Question 2.7 38
Question 2.8 39
Question 2.9 40
Question 2.10 41
Question 2.11 43
Case study 2.1: Public sector audits 44
Case study 2.2: LRS Ltd 45
Case study 2.3: Potholders Ltd 46
Case study 2.4: Professional scepticism 49
Case study 2.5: JBR Ltd 50
Case study 2.6: HIH and the independence of auditors 51
Case study 2.7: HIH 53
Case study 2.8: WorldCom 55
Case study 2.9: Clive Peeters 56
Question 3.1 58
Question 3.2 59
Question 3.3 60
Question 3.4 61
Question 3.5 62
Question 3.6 63
Question 3.7 64
Question 3.8 65
Question 3.9 66
Question 3.10 67

, AAA_Study Guide Questions and Answers_3rd edition
Question 3.11 68
Question 3.12 72
Question 3.13 74
CONTENTS | iii



Case study 3.1: LM Ltd 77
Case study 3.2: Beta Ltd 79
Case study 3.3: Dobbie Pty Ltd 82
Case study 3.4: Acme Ltd 84
Case study 3.5: China Wide Consortium 86
Case study 3.6: ProGolf Ltd 90
Case study 3.7: Cosmic Electronics Ltd 94
Case study 3.8: Timber floors 95
Case study 3.9: Airline industry 96
Case study 3.10: Creamy Ltd 98
Case study 3.11: QRS Ltd 99
Case study 3.12: MNO Ltd 104
Question 4.1 106
Question 4.2 108
Question 4.3 109
Case study 4.1: The Education Fund Ltd 110
Case study 4.2: Gamma Pty Ltd 113
Case study 4.3: Interlock Pty Ltd 114
Case study 4.4: Huggins Ltd 117
Case study 4.5: Amna Ltd 121
Case study 4.6: South Ltd 124
Case study 4.7: Clark Ltd 128
Case study 4.8: Pet Ltd 132
Case study 4.9: Carey Ltd 136
Question 5.1 138
Question 5.2 140
Question 5.3 141
Question 5.4 143
Question 5.5 145
Question 5.6 147
Question 5.7 149
Question 5.8 151
Question 5.9 153
Case study 5.1: Idealic Pty Ltd 154
Case study 5.2: E-ffervescence.com Ltd 156
Case study 5.3: Diabetes Victoria 158
Case study 5.4: Manna Pty Ltd 161
Question 6.1 163
Question 6.2 164
Question 6.3 165
Question 6.4 166
Question 6.5 167
Question 6.6 169
Question 6.7 170
Case study 6.1: Performance reporting by departments 172
Case study 6.2: Home Care Service 173