Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Background Safe Netis the wealth management division of SecurityBank (Security) and provides investment, superannuation, insurance and private wealth solutions to corporate and institutional customers. The

Background

Safe Netis the wealth management division of SecurityBank (Security) and provides investment, superannuation, insurance and private wealth solutions to corporate and institutional customers. The following is a list of the auditor's planning file notes in relation to fraud detection for the audit of the Safe Netunit.

  1. Ensure all material fraud instances are detected.
  2. The auditor is responsible for maintaining professional scepticism throughout the audit, considering the potential for management override of controls and recognising the fact that audit procedures that are effective for detecting error may not be effective in detecting fraud.
  3. Respond appropriately to fraud or suspected fraud identified during the audit.
  4. A discussion among all of the audit firm's staff on how and where the entity's financial statements may be susceptible to material misstatements due to fraud, including how fraud might occur.
  5. Make enquiries of management, and others within the entity as appropriate, to determine whether they have knowledge of any actual, suspected or alleged fraud affecting the entity.
  6. Obtain sufficient appropriate audit evidence to confirm all potential fraud instances have been uncovered and their impacts considered.
  7. Test the appropriateness of journal entries recorded in the general ledger and other adjustments made in the preparation of the financial statements.
  8. Determine whether management has sufficient skills to prevent and detect fraud (e.g. through proof of attendance at appropriate industry seminars and workshops, or past experience with fraud).
  9. Obtain a copy of the client's code of ethics document, and ensure employees have access to it.
  10. Evaluate whether the accounting policies selected by the entity may be indicative of fraud.

REQUIRED: Identify the activities that are part and the activities that are not part of the auditor's responsibilities relating to fraud under ASA 240.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Management Accounting Information for creating and managing value

Authors: Kim Langfield Smith, David Smith, Paul Andon, Ronald Hilton, Helen Thorne

8th edition

9781760420413 , 978-1760420406

More Books

Students also viewed these Accounting questions