Question 4

1. Sinclair Pastoral Group is an unlisted pastoral company with several pastoral land holdings and a state-of-the-art feedlot based in Toowoomba. Complete the findings and conclusion of the following workpaper.

   MKGW CHARTERED ACCOUNTANTS AUDIT CURRENT FILE WORKPAPER
   Client Name	Sinclair Pastoral Group	Preparer		JAM
   Engagement Title	SPG	Date Prepared		30.4.21
   Period	31.3.21	Reviewer		MS
   Work Paper	4.1.1 FCI WS	Date Reviewed		11.5.21
   OBJECTIVE(S)	Substantive testing of Feedlot Commodities Inventory Balance at 31 March 2021
   Substantive Tests to be Performed
   1	Check the mathematical accuracy of the Feedlot Commodities Inventory Summary shown below.
   2	Calculate the Inventory Turnover Ratio (Cost of cattle & feedlot expenses for the Year is $95,860,246)
   3	Select and discuss the balance that is the most concerning from a materiality perspective. Overall Performance Materiality is $4.15m (70%) and Feedlot Commodities Inventory has a high control risk assessment
   4	Identify two tests of details of balances to perform on this account to ensure the balance is not materially misstated.
   5	Nominate individual categories for inclusion in auditor tests at the Feedlot Commodities Inventory stocktake. Detail reasons for your selection.
   Feedlot Commodities Inventory Account Summary at 31.3.21
   Inventory Category Items			Inventory Balance 31.3.21
   Roller mill components			$751,610
   Silo drainage system components			$523,281
   Earthworks equipment components			$550,115
   Electronic components for safety and storage structures			$615,160
   Infrastructure services components (power, gas, water & phone)			$110,705
   Total Feedlot Commodities Inventory Balance			$1,338,181
   Findings
   1
   2
   3
   4
   5
   CONCLUSIONS about this account balance