Question $6$

$(15$ marks$)$

Audit Procedures

You are an auditor in the firm of Balmoral Chartered Accountants and your audit

partner has informed you that the firm has obtained a new client. The client is a

manufacturer and retailer of mobile phones.

Required:

$($a$)$ The partner has requested your assistance in preparing the audit

programme. Specifically, he has requested that you provide him with a

description of THREE possible audit procedures to provide audit evidence

with respect of each of the following assertions:

$($i$)$ The existence of inventory.

$($ii$)$ The completeness of creditors.

$($iii$)$ The completeness and accuracy of revenue.

$($iv$)$ The occurrence and accuracy of wage costs.

$(12$ marks$)$

$($b$)$ The audit partner tells you that he is considering only performing analytical

audit procedures. Explain to him considerations an auditor should make

when determining the appropriate audit strategy and why the performance

of analytical procedures alone is unlikely to be appropriate.

$(3$ marks$)$