Question 1 (25 marks) You are assisting on the 31 March 2021 audit of Planned Dynamics (Pty) Ltd, a large industrial company. You have been assigned to the audit of land and buildings and long-term investments. The draft financial statements reveal the following: 2021 18 420 000 Land and Buildings 2020 15 200 000 The financial manager, who is also a member of the budgeting and investment committees has provided you with the following schedule: 1. Land and Buildings Cost 1.1 Factory situated on Lot 66 R9 400 000 Industrial Park Jacobs, Kwa Dukuza 1.2 Office block R4 800 000 14 Sterling Street Beachhead, Kwa Dukuza. 1.3 R1 000 000 Vacant Land Lot 21 Horizon Park, North Coast 1.4 R3 220 000 Apartment 214 The Drive, Umlazi R18 420 000 1.5 1.6 The movement on the Land and Buildings account relates to the purchase of apartment 214, The Drive in Umlazi. This property was purchased so that business executives and others visiting Planned Dynamics (Pty) Ltd could be accommodated for the period of their visits. The vacant land situated on the North Coast is in an undeveloped industrial park The property has been occupied in a "landgrab" and there seems little prospect of a settlement with the occupiers being reached in the near future. No development of the park (by the developers) as required, e.g. putting electricity etc., has taken place. The company does not depreciate its buildings. 1.7 REQUIRED Describe the audit procedures you will conduct on the land and buildings account at 31 March 2021. (25) Question 1 (25 marks) You are assisting on the 31 March 2021 audit of Planned Dynamics (Pty) Ltd, a large industrial company. You have been assigned to the audit of land and buildings and long-term investments. The draft financial statements reveal the following: 2021 18 420 000 Land and Buildings 2020 15 200 000 The financial manager, who is also a member of the budgeting and investment committees has provided you with the following schedule: 1. Land and Buildings Cost 1.1 Factory situated on Lot 66 R9 400 000 Industrial Park Jacobs, Kwa Dukuza 1.2 Office block R4 800 000 14 Sterling Street Beachhead, Kwa Dukuza. 1.3 R1 000 000 Vacant Land Lot 21 Horizon Park, North Coast 1.4 R3 220 000 Apartment 214 The Drive, Umlazi R18 420 000 1.5 1.6 The movement on the Land and Buildings account relates to the purchase of apartment 214, The Drive in Umlazi. This property was purchased so that business executives and others visiting Planned Dynamics (Pty) Ltd could be accommodated for the period of their visits. The vacant land situated on the North Coast is in an undeveloped industrial park The property has been occupied in a "landgrab" and there seems little prospect of a settlement with the occupiers being reached in the near future. No development of the park (by the developers) as required, e.g. putting electricity etc., has taken place. The company does not depreciate its buildings. 1.7 REQUIRED Describe the audit procedures you will conduct on the land and buildings account at 31 March 2021. (25)
