3 Faster Jets Co is an airline company and is a new audit client of Brown...
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3 Faster Jets Co is an airline company and is a new audit client of Brown & Co. You are responsible for the audit of the financial statements for the year ended 30 November 2014. The draft financial statements recognise revenue of $150 million and total assets of $250 million. (a) During the year, Faster Jets Co purchased several large plots of land located near major airports at a cost of $12.5 million. The land is currently rented out and is classified as investment property, which is recognised in the draft financial statements at a fair value of $14.5 million. The audit partner has suggested the use of an auditor's expert to obtain evidence in respect of the fair value of the land. Required: In respect of the land recognised as investment property: (i) Explain the additional information which you require to plan the audit of the land; and (ii) Explain the matters to be considered in assessing the reliance which can be placed on the work of an auditor's expert. 3 Faster Jets Co is an airline company and is a new audit client of Brown & Co. You are responsible for the audit of the financial statements for the year ended 30 November 2014. The draft financial statements recognise revenue of $150 million and total assets of $250 million. (a) During the year, Faster Jets Co purchased several large plots of land located near major airports at a cost of $12.5 million. The land is currently rented out and is classified as investment property, which is recognised in the draft financial statements at a fair value of $14.5 million. The audit partner has suggested the use of an auditor's expert to obtain evidence in respect of the fair value of the land. Required: In respect of the land recognised as investment property: (i) Explain the additional information which you require to plan the audit of the land; and (ii) Explain the matters to be considered in assessing the reliance which can be placed on the work of an auditor's expert.
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Faster Jets Co Audit of Investment Property i Additional Information Required To effectively plan the audit of Faster Jets Cos investment property you need additional information in the following area... View the full answer
Related Book For
International Financial Reporting and Analysis
ISBN: 978-1408075012
5th edition
Authors: David Alexander, Anne Britton, Ann Jorissen
Posted Date:
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