Auditing and Assurance Services: Please answer it follow the requirement and marks allocation. The important part is a discussion on differents matter not the summary of ISA. Thanks!
Antonis Diolas, ACCA's head of audit and assurance, says: 'Audit hasn't stopped because of Covid-19-auditors are still providing their services. But we need to focus on what the practical challenges are, and what needs to be considered when dealing with them.' Diolas acknowledges that the auditing profession has already travelled some way down the road to embracing digitally transformative processes ahead of the Covid-19 crisis. As a result, auditors around the world have been able to adapt their processes effectively when face-to-face meetings and audit inspections are ruled out under various lockdown requirements. A non-face-to-face environment showcases that audit can be carried out if both sides are working towards the same goal," Diolas says. It has been suggested that eight major areas where auditors need to consider, or reconsider, how their work has been or will be affected by the pandemic. The areas are: identifying and assessing risks of material misstatement auditor's response to assessed risks audit evidence auditing accounting estimates subsequent events going concern modifications to the audit report opinion Emphases of matter in the audit report. Extracted from: Philip Smith's (journalist) article Required: Among the key 8 issues listed above, discuss, the issues of "Going concern", and "accounting estimates" on how external auditors in the course of financial statements to respond to the Covid-19 crisis (1) In relation to going concern issue, you are required to discuss the following specific matter in the context of ISA 570 The company's liquidity over the duration of Covid-19 and after Loss of major market, key customer(s), revenue, labour shortages Any breach of financing terms The use of available government subsidies and other support The impact of Covid-19 in the overall operations of the company (18 marks) (For each of the above issue, you are required to discuss how those issue /matter could affect the going concern of an organisation) * (Summary of ISA 570-3 marks, discussion of each of the above specific matters, 3 marks each, 5 x 3 marks=15 marks, Total 18 marks) In relation to the accounting estimates" you are required to discuss the following specific matters in the context of ISA 540 Impairment of assets Return provisions for merchandise sales Onerous contracts (Provide the relevant accounting standard (MFRS) to support your discussion) (12 marks) *(Summary of ISA 540-3 marks, discussion of each of the above specific matters, 3 marks each, 3 x 3 marks 9 marks, Total 12 marks)
