Brighter Alloys Ltd (BA), a company based in the city of Bruddersford, deals in alloys used in the steel industry. It was founded in 1969 by Jack Brightman. In 1979 he and his family sold their shares in the company to Dickens Steel plc, and BA is now a wholly owned subsidiary of Dickens.

Parker & Co. act as auditors of all the twelve companies in the Dickens Group, whose year-end is 31 December. From 1969 until 1987 Slott & Co., a small firm, were auditors of BA; the change of auditor was the decision of the finance director of Dickens..................

QUESTIONS FOR DISCUSSION
1. Mark comments that ‘any approach based on sampling involves a risk that errors will be overlooked. The audit isn’t a guarantee that no fraud has occurred’. How far do his views reflect the spirit of the auditing guidelines? :
2. What measures might have prevented or detected the fraud at Brighter Alloys, and whose responsibility were they?