During your semester break, you participated in a

vacation program at a local audit firm. During the

vacation program, you assisted an audit senior on

the planning of a medium sized company, including

developing appropriate substantive audit

procedures. You have one more semester to

complete your post graduate course and have

indicated to the audit manager that you would like to

work on a full- time basis at the audit firm on

completion of you course.

The audit manager has asked you to write a report

as part of the process of determining your suitability

as a candidate for a permanent role in the audit firm

The manager wants to assess your ability to apply

the knowledge you gained, to the audit planning

process and developing appropriate substantive

procedures as well as your report writing skills.

You are required to address the following in your

report (refer to rubrics on page 4 & 5 of this

document for breakdown of marks and achievement

criteria by component):

1. Identify 4 business risks of The Company, that will

increase the risk of material misstatement

(specifically inherent risk) at the assertion level for

classes of transactions or account balances. For

each business risk, identify onlv 1 class of

transaction or account balance (income statement or

balance sheet line item), and for each class of

transaction/account balance please identify the

assertion most (only one) at risk of misstatement.

You need to explain why each business risk will lead

to a risk of misstatement to the specific class of

transaction/account balance and assertion that you

have identified.

2. Describe in detail, the appropriate substantive

procedure that will address each of the class of

transaction or account balance and assertion

identified as at risk of material misstatement. The

description of procedures must be detailed enough

for someone without auditing knowledge to be able

to carry out the procedures correctly.

Additional Requirements:

You must include the following in your report:

1. Titlepage

2. Tableofcontents 3. Executivesummary 4

Introduction

5. Bodyofreport

6. Conclusion

7. References

Sources of information for this assessment may

include:

1. The latest annual report of The Company

2. The Company website

3. Announcements on AX with regards to The

Company

4. News articles on The Company

5. Corporate Governance statements of The

company