The directors of Synergy Pty Ltd (Synergy) have provided its external audit firm with an oral representation confirming that the bank overdraft balances included within current liabilities are complete.

REQUIRED

1. Describe the relevance and reliability of this oral representation as a source of evidence to confirm the completeness of the bank overdraft balances.                         

Explain why the auditor is concerned particularly with completeness of bank overdraft.                                                                                                                                          

Design an additional audit procedure for bank overdrafts. Explain how this procedure will address the concern identified in b) (i).