You work for CRG LLP, a medium sized accountancy practice based in Manchester. You are currently planning the upcoming audit of one of your largest clients, Reuseaphone Ltd. Reuseaphone Ltd is a UK company that sells goods online, specialising in refurbished technology such as phones and laptops. The business was set up by two technology entrepreneurs (Asad Khan and Daniel Green) who wanted to limit the environmental impact of technology and show that refurbished items can be just as good as those bought brand new.

The company has the following operations:

Warehouse based in Stockport UK employs 150 staff, 50 of which are permanent and 100 are on zero hours contracts (numbers can very between 60 and 150 on zero hours depending on the time of year).

Head office based in Stockport employs 50 permanent staff who perform all the back office functions e.g. finance, sales and marketing, HR etc.

A number of satellite centres based internationally there are three in

Europe (Germany, the Netherlands and Austria), and Reuseaphone opened 5 US centres in the past two years. These employ 100 people in total.

As well as providing hardware such as phones and laptops, the company also provides low cost mobile phone contracts in the UK, under the contract provider Valuephone. These contracts vary in length between 12 and 24 months, and customers who enter these contracts receive a discount on their handsets.

Reuseaphone has grown significantly in the last few years and is looking to become listed on both the UK and US stock exchanges (as it believes the US market is lucrative for the future). In anticipation of its growth into the US market, the company has integrated blockchain technology into their operations during the current financial year.

There is a meeting with the Finance Director of Reuseaphone Ltd in two weeks time and the engagement partner for this client, Maria Webb, has requested that you provide her with some information to assist in the upcoming discussions.

You are required to prepare an individual report for Maria which details the following:

The key risks to Reuseaphone Ltd from the implementation of IFRS15 Revenue Recognition, and the impact of this standard on the entity when selling products and phone contracts.

(750 words) A consideration of the use of non-financial reporting that Reuseaphone Ltd could adopt, and what frameworks/ guidelines would be best to follow

(750 words) Analysis of the main issues Reuseaphone Ltd will face when reporting under both full IFRS and US GAAP if it becomes dual listed (500 words)

A critical discussion on how the use of blockchain technology will impact the audit of Reuseaphone Ltds financial statements i.e.

Discuss two opportunities this technology will bring to the audit process?

Discuss two challenges this technology will bring to the audit process?

(1,000 words)

A discussion of two other technological advancements that could be used by your audit firm and how these will improve the audit process.

(500 words)

Your report should be 3,500 words in length (+/-10%), and draw on research of similar companies and sectors. We would expect to see a minimum of 15 references

A penalty will be applied to your overall mark if you exceed the word count by more than 10%. The penalty applied will be the dropping of one grade band using the step marking system.

There will be three tutorial sessions focussed on the assignment, in which we will work through the main areas, and ensure you can research the assignment fully. It is vital you attend these sessions.