Show how the following events should be reflected in the accounts at 31 December 2015 and describe audit procedures you would carry out to verify them:

1. Company B acquired non-current assets for 500.000 on 29 January 2016. The financial statements at 31 December 2015 showed non-current assets at cost less depreciation amounting to 250.000.
2. Company C has shown in its financial statements at 31 December 2015 an investment in another company at cost of 750.000. On 1 March 2016 there is a significant decline in prices on the Stock Exchange resulting from unexpected foreign exchange movements, resulting in a quoted value of 550.000.

Answer rating: 100% (QA)

Solution A Accounting treatment and audit procedure of non current asset which are required 29 January 2016 are as follows Non non current assets acqu... View the full answer