Question 4

You are the auditor for Heuristics Ltd, who is in the medical industry. On review of the company's draft nancial report for the year ended 31 July 2019, the engagement partner observes that a substantial amount of equipment is shown in the Statement of Financial Position. You are currently evaluating the inherent risk of Heuristics Ltd. Required (a) Identify and explain three (3) factors the auditor would consider in assessing the inherent risk for PPEs. (b) What factors will you consider in selecting samples from the population of Property, Plant, and Equipment (PPE) for substantive testing? (c) You are involved in the audit PPEs this year. Identify and explain six (6) substantive procedures you will carry out on the PPE accounts. Your answer should be in the following format: Assertions Substantive Procedures (d) Identify and explain ve (5) substantive procedures that can be used to audit the impairment of PPEs