Planning substantive testing procedures Background: You are part of the audit team assigned to the audit of Maidenhair Enterprises for the year ended 30 June 2020. The trial balance for this client is shown below. The screenshots are the flow of the questions on the word file they are zoomed in for eligibility

Word File Edit View Insert Format Tools Table Window Help 10 16:18 11:00 PM 100% 67 Fri Sep 18 10:53 E W 10865 Q- Search in Document Home Insert Design Layout References Mailings Review View + Share Calibri (Body) 12 - A A A, A T AaBbDdEe AaBbCD AaBbCcDdE AaBb AaBb CcDdE AaBbCcDdEE AaBbCcDdEe Paste B I Uabe Xx? A-, A IE Normal Heading 1 Heading 2 Title Subtitle Subtle Emph... Emphasis Styles Pane 1 11 12 13 14 15 16 17 18 19 A 4 Background: You are part of the audit team assigned to the audit of Maidenhair Enterprises for the year ended 30 June 2020. The trial balance for this client is shown below. Maidenhair Enterprises Trial Balance June 30, 2020 Cr Current year June 30, 2020 Dr Cash at bank 37,525 Accounts receivable 36,365 Inventory 175,295 Machinery 141,000 Accumulated depreciation Furniture 11,000 Accumulated depreciation Accounts payable Prior year June 30, 2019 Cr Dr 36,271 34,642 173,034 140,900 30,750 11,000 2,623 12,450 9 23,250 2,050 13,450 Page 1 of 4 1687 words Tx English (Canada) + 199% Word File Edit View Insert Format Tools Table Window Help 16:09 11:00 PM 100% 67 Fri Sep 18 10:53 E C W 10865 Q- Search in Document Home Insert Design Layout References Mailings Review View 9+ Share Calibri (Body) - 12 - A A A, A E A T AaBbCcDdEe AaBbCD AaBbCcDdE AaBb AaBb CcDdEx AaBbCcDdEE Aa Bb CcDdEe Paste B I Uabe Xx? A-SA- IE Normal Heading 1 Heading 2 Title Subtitle Subtle Emph... Emphasis Styles Pane 1 11 13 14 15 17 18 | 16 19 Bank Loan Sales Cost of sales Consulting revenue Interest income Other income Bank charges Depreciation Interest expense Printing Wages Superannuation Equity (net) 240,000 241,470 130,250 53,645 56 1,434 515 8,073 12,343 501 55,260 5,349 31,048 613,476 613,476 240,000 230,520 135,501 37,890 32 5,075 350 7,944 10,092 896 54,005 5,095 57,463 609,730 609,730 Notes from last year's audit file indicated that internal controls around revenue and current assets are strong, while controls around other accounts are generally weak. Tests of controls confirmed this is also the case for the current year. The preliminary assessment of materiality has been set at $5,000. The senior auditor in your team has asked each team member to substantively test a different account. To identify the account that has been allocated to you, refer to the accompanying document: Allocation of Tx English (Canada) Page 1 of 4 1687 words + 199% Word File Edit View Insert Format Tools Table Window Help 11:00 PM 100% C2 Fri Sep 18 10 53 E 1 0 16:00 @ W 10865 Qw Search in Document Home Insert Design Layout References Mailings Review View 9+ Share Calibri (Body) - 12 - A A A A, A T AaBbcDdEe AaBbCD AaBbCcDde AaBb AabbCedd Ee AaBbCcDdEE AaBbCcDdEe Paste BIU Uabe Xx2 A. A, IE Normal Heading 1 Heading 2 Title Subtitle Subtle Emph... Emphasis Styles Pane 1 5 6 8 9 10 11 12 13 14 1 15 16 17 18 19 1 accounts.doc . Bank charges. Your task: Your task is to prepare a working paper/s to be included in the audit file, for your allocated account(Bank charges). The working paper/s must address the four points below. 1. Consider which assertions are likely to be most at risk for this account. Identify 2 to 3 relevant assertions, and briefly explain why these assertions are likely to be at-risk. In doing so, you should consider whether the account has increased or decreased compared with the prior year and consider the key risks generally applicable to this type of account. 2. Describe an audit procedure/s which would provide sufficient appropriate evidence for the identified assertions. =It is recommended that you prepare your audit working paper using either Microsoft Excel or Microsoft Word and use the Comment feature. You will examine examples of audit working papers in your tutorials. Some Page 1 of 4 1687 words DE English (Canada) + 199% Word File Edit View Insert Format Tools Table Window Help 15:52 11:00 PM 100% 2 Fri Sep 18 10 53 E W 10865 Q- Search in Document Home Insert Design Layout References Mailings Review View 9+ Share Calibri (Body) 12 - A A A, A T AaBbCcDdEe AaBbCD AaBbCcDdE AaBb AaBb CcDdE AaBbCcDdEE AaBbCcDdEe Paste B I HE Normal Heading 1 Heading 2 Title Subtitle Subtle Emph... Emphasis Styles Pane 1 Uabe Xx A-SA- LLLL examples are also included in the textbook. 11 12 13 14 15 16 14 18 19 L =Ensure that your working paper clearly identifies the account being tested, a relevant audit objective, relevant assertions, and the procedure/s to be used. 3. The senior auditor has asked you to select a sample of 5 transactions from your general ledger account for vouching. Access the general ledger detail for your account and identify 5 specific entries to make up your sample. Consider the impact of your sample selection technique on the audit budget. Describe/illustrate your sample selection process. Provide a brief statement justifying your sample selection approach with reference to the Australian auditing standards. 4. Comment on whether you think vouching these 5 transactions will provide sufficient appropriate evidence for this account. Consider how material the account is and the level of detection risk that would be appropriate for this account. Consider the direction of testing, and whether it is appropriate for your assertions. You may like to address points 3 and 4 on a separate working paper, or include this on your existing working paper. You do not have the documents required to complete the audit testing for this account. As such, your working paper/s will be incomplete. There should be a section at the bottom which says "Conclusion:" but this will remain blank. It would likely be completed during a site visit to the client. Page 2 of 4 1687 words Tx English (Canada) + 199% Word File Edit View Insert Format Tools Table Window Help @ 15:33 11:00 PM 100% 12. Fri Sep 18 10 54 E C W 10865 Q Search in Document Home Insert Design Layout References Mailings Review View + Share Calibri (Body) - 12 - A A A, A T AaBbcDdEe AaBbCD AaBbCcDdE AaBb AaBb CcDdE AaBbCcDdEE Aa Bb CcDdEe Paste B I Uabe X2 x AA HE Normal Heading 1 Heading 2 Title Subtitle Subtle Emph... Emphasis Styles Pane 1 13 14 15 1.16 17 18 19 3. The senior auditor has asked you to select a sample of 5 transactions from your general ledger account for vouching. Access the general ledger detail for your account and identify 5 specific entries to make up your sample. Consider the impact of your sample selection technique on the audit budget. Describe/illustrate your sample selection process. Provide a brief statement justifying your sample selection approach with reference to the Australian auditing standards. 4. Comment on whether you think vouching these 5 transactions will provide sufficient appropriate evidence for this account. Consider how material the account is and the level of detection risk that would be appropriate for this account. Consider the direction of testing, and whether it is appropriate for your assertions. You may like to address points 3 and 4 on a separate working paper, or include this on your existing working paper. You do not have the documents required to complete the audit testing for this account. As such, your working paper/s will be incomplete. There should be a section at the bottom which says Conclusion." but this will remain blank. It would likely be completed during a site visit to the client. Criteria Your assignment will be graded based on the criteria below. Please pay due regard to these criteria. Page 2 of 4 1687 words Tx English (Canada) + 199%