Long term contracts - audit process, Auditing

Long Term Contracts - Audit Process

The authoritative document with reference to long term contracts is IAS 11: Construction Contracts and IAS 18: Revenue Recognition, and ISA 600 Reliance on the Work of another Auditor.

IAS 11 Construction Contracts

A construction contract is a contract particularly negotiated about the construction of an asset or mixture of assets that are closely interdependent or interrelated in terms of their technology, design and function or their eventual purpose or needs.

That contract often span quite than one accounting time. This provides rise to a number of accounting and hence auditing issues. The auditor must examine a schedule of each the construction contracts such the enterprise is currently engaged in, and reach a decision as to where attribute to capable losses and profits have been satisfactorily estimated.

Also the presentation of contracts in the financial statements must accord along with the IAS. Even though the auditor should have a working knowledge to be capable to deal along with many aspects of long term contracts, it may be essential to contact external experts to seek assurance in specialist areas wherever the auditor has not enough expertise himself. Assume an example, determination of the stage of completion of a building in course of construction.

Posted Date: 1/28/2013 12:05:14 AM | Location : United States

Related Discussions:- Long term contracts - audit process, Assignment Help, Ask Question on Long term contracts - audit process, Get Answer, Expert's Help, Long term contracts - audit process Discussions

Write discussion on Long term contracts - audit process
Your posts are moderated
Related Questions
The first work you do in IDEA IS SECTION 2.5. The accounts receivable folder that you are instructed to select on page 25 is a folder that you are to create previously on page 23.

Fairness -  Auditing The word fair can have the following meanings:  on the other hand clear, plain and distinct and on the one impartial, equitable and simple.  When fair is

State four factors considered determining sufficiency of audit evidence

Audit of Accounting Estimates An accounting estimate is described in ISA 540 Audit of Accounting Estimates as 'an estimation of the amount of an item in the absent of a precis

Q. Which of the following statements is not considered a disadvantage of the corporate form of organization? a. Additional taxes b. Government regulations c. Limited liability of s

(a) Define each of the following four concepts. -Master Data Management -Data Quality -Data Governance -Cloud Computing Explain how they relate to the various Busine

Framework of critical thinking principles (a) Identify the key steps in this framework/ concept. (b) Briefly explain each of the key steps, in your own words. Ans: Thin

Reference to an expert in the Auditor's Report When issuing an unmodified auditors report, the auditor should not refer to the work of the expert.  This is because such a refe

Need for an Audit Whether you take an example for a modern large liability company, such we can clearly differentiate between those who control those funds the providers of fu

Non-statutory Audits The non-statutory audits are performed through independent auditors sicne the owners, proprietors, trustees, members  and governing and professional bodie