In October 2022, the Australian Securities and Investments Commission (ASIC) issued its report 743 - Audit inspection program report ("The report"): 1 July 2021 to 30 June 2022. Based on the report, ASIC has identified some key audit areas that it found negative findings during its inspection (page 11), including: Revenue/Receivables, Impairment/Asset valuation, Investment/Financial Instrument, Loan/Borrowing, etc. (ASIC 2022).

For each of those key areas with negative findings above, the Report pointed out some matters contributing to the negative findings. For example, for Revenue/Receivables, the Report stated that the matters contributing to the negative findings include Tests of details, Internal control, Risk assessment, Accounting estimates, Accounting policies, Substantive analytical procedures, etc. (ASIC, 2022, page 12).

Q: Please read the Report, select one key audit area and give a short discussion (150 words) on one of the matter contributing to the negative findings. You are expected to refer to the corresponding Australian Auditing Standards (ASAs)".