( You are the auditor of Barnaby Pty Ltd (Barnaby) and are in the process of...

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( You are the auditor of Barnaby Pty Ltd (Barnaby) and are in the process of completing the audit for the year ended 30 June 2022. The following two (2) outstanding matters have been highlighted in your firm's completion documentation: a) You have heard a rumour that Barnaby is planning to acquire a key competitor, Sander Pty Ltd (Sander). If accurate, this will have disclosure implications. Management have advised you that although they have had several meetings with the management of Sander, no such acquisition is currently planned. Management have offered to make written representations confirming their intentions. b) The invoices to support the cost of a significant purchase of a new computer system cannot be found. Management have offered to make written representations confirming the cost of the computer system. < Are the client's written representations sufficient to resolve each of the outstanding matters noted above? Justify your answers. ( You are the auditor of Barnaby Pty Ltd (Barnaby) and are in the process of completing the audit for the year ended 30 June 2022. The following two (2) outstanding matters have been highlighted in your firm's completion documentation: a) You have heard a rumour that Barnaby is planning to acquire a key competitor, Sander Pty Ltd (Sander). If accurate, this will have disclosure implications. Management have advised you that although they have had several meetings with the management of Sander, no such acquisition is currently planned. Management have offered to make written representations confirming their intentions. b) The invoices to support the cost of a significant purchase of a new computer system cannot be found. Management have offered to make written representations confirming the cost of the computer system. < Are the client's written representations sufficient to resolve each of the outstanding matters noted above? Justify your answers.

Answer rating: 100% (QA)

a The clients written representations may not be sufficient to resolve the rumour about the potentia... View the full answer