ACCT3600 Accounting and Auditing in Practice Semester 1, 2023
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ACCT3600 Accounting and Auditing in Practice
Semester 1, 2023
Group Written Report [25 marks]
The research case study report is due for lodgement via the TURNITIN link on canvas by 23:59 Monday 15 May 2023 (Week 12).
Required:
(i) Find a media article about a company listed on the Australian Securities Exchange (ASX) that discusses certain “business risks” the company may be exposed to, which may suggest that the auditor could face potential “audit risks” when completing the audit for this company.
Note: The media article must have a publication date on or after 15 November 2022. A copy of the article will need to be submitted with the completed assignment (Part 2) as an appendix.
Failure to attach the selected article with the assignment SHALL incur a 10% penalty of the total marks awarded for the assignment.
(ii) Based on the information in your selected article as well as other relevant information about this company, prepare a report addressing the following questions:
Q1: Demonstrate your understanding of the selected company by providing a detailed description of its business operations. You must include a description of its revenue streams, products and services, business processes, competitive environment and regulatory environment.
Refer ASA 315 Identifying and Assessing the Risks of Material Misstatement (including the appendix) to help guide your response.
Your answer to this part should be reflective of your in-depth understanding of the company’s operations, not merely a summary of informationfrom the annual report. [5 marks]
Q2: Calculate the following ratios for your selected company based on the most recent audited financial report (year t) and include the table in your report:
Financial Ratios |
Year t |
Year t- 1 |
Current ratio |
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Quick asset ratio |
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Operating cash flow ratio |
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Receivables turnover ratio |
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Inventory turnover ratio |
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Return on assets |
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Return on equity |
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Gross profit ratio |
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Net profit ratio |
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Debt / Equity |
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Times interest earned |
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Comment on the company’s liquidity, activity, profitability, and solvency based on the ratios above and explain how your analysis may influence the audit process.
Refer to ASA 520 Analytical Procedures and ASA 570 Going Concernfor guidance. [3 marks]
Q3: Based on your analyses in Q1 and Q2, explain why the information in the selected article presents a “business risk” or “business risks” to the company and how the risk(s) would affect the audit process? [2 marks]
Q4: Based on the information contained in the article and any additional research, identify two key accounts related to the event in the article that would warrant a key audit matter (KAM) paragraph in your audit report.
Explain why these two key accounts warrant key audit matter paragraphs in your audit report. [4 marks]
For each of the key account, identify one prime assertion (two assertions in total) that the auditor might select to prioritise in their audit plan. [2 marks]
For each of the two assertions identified, detail two audit procedures/substantive tests (4 audit procedures in total) to address how your audit addresses the key audit matters? [6 marks]
Refer to ASA 701 Communicating Key Audit Matters in the Independent Auditor’s Reportfor guidance on KAM.
Q5: Discuss how information in the selected article may impact on your audit report and the audit opinion you form? [1.5 marks]
Q7: Your assignment should be submitted in a format as if it were to be presented to a meeting of senior auditors at your accounting firm and designed to impart your key messages. It should be succinct, and use of tables and graphs is encouraged. The report should also be coherent and so consistency is expected throughout (e.g., formatting, language style, and linkages between the questions). Note that groups who split up the tasks and work independently are likely to have more difficulty accomplishing this objective compared to groups who work on each of the parts collaboratively. Note, merely complying with the presentation guidelines will receive low marks for presentation. To gain full marks, student will need to present their assignment in a highly professional manner. [1.5 marks]
Other requirements:
Business risks:
Please refer to ASA315 Identifying and Assessing the Risks of Material Misstatement (including the appendix) for examples of business risks in guiding you to select your articles.
Some examples might include:
1. financial distress,
2. material fraud,
3. material misstatements in the financial statements.
The media article:
a) The library database “Factiva” is recommended which provides access to newspapers, media journals, web sites and radio and television broadcasts. Tip: You can narrow down your search results by specifying “date”, “source” and “subject” in addition to your search terms.
b) The media article can deal with any event that has occurred before, still in progress or only recently came to the media’s attention.
c) The media article must have been published within the 6 months prior to the assignment due date.
Key Audit Matters:
Please refer to ASA 701 Communicating Key Audit Matters in the Independent Auditor’s Report for useful information around KAM.
Presentation/Formatting
Note that as this is a research assignment, appropriate reference citations throughout the report are expected.
The assignment shall be presented in the following format. Failure to comply with any of the following requirements SHALL incur a 10% penalty of the marks awarded for the assignment.
• A cover page, which needs to be downloaded from Canvas and must contain the required information.
• All Student SIDs MUST appear on each page as part of the page footer.
• The body of the assignment - This is not to exceed 12 pages, single-sided and is to use Times New Roman size 12 font, 1½ line spacing and margins on all sides at 2.5 cm minimum. Use of headings, graphs, tables and bulleted lists is encouraged. However, the assignment should still be largely based on text in paragraphs and build a narrative.
• Please keep a copy of your Turnitin assignment receipt.
• Page numbers must be included at the bottom of each page.
• Appendices:
o Part 1: A Bibliography is required and is not counted towards the 12 pages limit. Referencing must conform to the Business School Referencing Guide (BSRG). For the purposes of in-text referencing of Accounting and Auditing Standards, you may use: (ASA 701 para. 12). For the purpose of in-text referencing of companies’ Annual Reports you may use: (XXX AR 2015 p. 12). All other references and the reference list must conform to the BSRG.
o Part 2: A copy of the selected article must be attached.
o Other appendices are acceptable but will not be marked and are not to be used to circumvent the restrictions on the length of the assignment. The appendices are not counted towards the 12 pages limit.
• All assignments must be typed. Footnotes should be reserved for points of clarification. Marks may be deducted for inappropriate use of footnotes and appendices.
Submission details:
a) The assignment can ONLY be lodged via the TURNITIN link in the canvas site
b) The assignment is due at 23:59 Monday 15 May 2023 (week 12), submission date and time will be determined by the TURNITIN system.
c) The submission of the peer assessment of groupwork performance (see Canvas) is optional. However, if you decide to submit one, it must be submitted individually as a separate document electronically via Canvas, by the same due date of 23:59 Monday 15 May 2023 (week 12). No late submissions will be accepted. All late submissions as well as non-submissions will be treated as if you have rated each and every one of your group members (including yourself) an average effort score of 3 for all the questions, hence a total score of 30 (details see the marking scheme of the peer assessment of groupwork performance on Canvas).
d) The penalty for assignments submitted late is 5% per calendar day or part thereof for each group member. No assignments will be accepted after the closing date of
25 May 2023 and submissions beyond this date will receive a mark of zero for each group member.
e) Each group member is expected to be involved in the preparation, drafting, proofing and checking of all aspects of this group assignment including ensuring no breaches of academic honesty. Members will be held jointly responsible for the entire submission and awarded the same merit mark (before any peer evaluation-based adjustments). In the event of a breach of academic honesty the penalty will apply to all members irrespective of which member(s) caused the breach.
The marking criteria are provided at the end.
Any other questions, please post it to the discussion board.
Good Luck!
The ACCT3600 Team
The group written research report marking grid
0-34% |
35-65% |
65- 100% |
85- 100% |
Does not satisfactorily address the question/requirement
Demonstrates limited research undertaken
Little reference/material has been identified/used
Provides a limited discussion of the material/reference with little or no critical evaluation
Presents arguments often lacking in cohesion and substantive evidence |
Address the question/requirement with acceptable coverage of key concepts Demonstrates a reasonable amount of research undertaken
Identifies key references/materials relevant to the project
Provides a discussion of the material/reference with limited critical evaluation
Presents cohesive arguments sometimes lacking in substantive evidence |
Thoroughly addresses key aspects of the question/requirement
Demonstrates a comprehensive research undertaken
Identifies key references/materials relevant to the project
Provides a sound discussion of the material/reference with critical evaluation
Presents cohesive, scholarly arguments supported by substantive evidence |
Thoroughly addresses all aspects of the question/requirement
Demonstrates a comprehensive and original research undertaken Identifies and integrates key references/materials relevant to the project
Provides an extensive and informed critical evaluation of the materials
Presents cohesive, scholarly arguments supported by substantive evidence |
2023-05-15