Buildwell Manufacturing Company was formed 10 years ago. At that time it took out a 30- year mortgage to purchase land and a factory building that continues to house all of its manufacturing, warehousing and office facilities. It also owns various manufacturing and office equipment acquired at various dates. It is in the process of constructing an addition to the factory building to provide more warehouse space. The addition is approximately 50 per cent complete and should be completed during the next financial year. The general ledger for Buildwell includes the following accounts for plant assets: Land, Factory Building, Manufacturing Equipment, Office Equipment, and related accumulated depreciation control accounts for each of the last three accounts. The details of the cost and accumulated depreciation for each item of the manufacturing and office equipment are maintained in separate sections of a plant ledger. There is also a Construction-in-Progress account for the accumulated costs of the warehouse addition.

Buildwell is a new audit client for your accounting firm that has never been audited before. You have completed the preliminary planning for the audit of plant assets and are about to design substantive procedures. Under the circumstances, you have assessed both inherent and control risk as high for all fixed asset assertions.

Required

(a) Using only your general knowledge of accounting for property, plant and equipment assets and the general framework for developing an audit programme for substantive procedures described in this chapter, develop an audit programme for your first audit of the property, plant and equipment asset accounts of Buildwell Manufacturing Company.

(b) Following each procedure in your audit programme, indicate the assertion (or assertions)
to which it applies by using the letters EO, C, RO, VM, and PD for the existence or occurrence, completeness, rights and obligations, valuation or measurement, and presentation and disclosure assertions, respectively.