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Action if Management Refuses to Provide Representations
If management refuses to provide a representation that the auditor considers essential, this constitutes a scope restriction and the auditor must express a qualified opinion or a disclaimer of opinion. In such conditions, the auditor would evaluate any reliance placed on other representations made by management during the course of the audit and consider if the other implications of the refusal may have any additional effect on the auditor’s report.
Problem 10.42 An investment of $83 generates after-tax cash flows of $49 in Year 1, $67 in Year 2, and $131 in Year 3. The required rate of return is 20 percent. The net presen
Communications to Regulatory and Enforcement Authorities The auditor’s professional responsibility to sustain the confidentiality of client information ordinarily prevents repo
IAS 12 Income Taxes 1AS 12 needs a deferred tax liability should be well known for all taxable temporary difference with minor exceptions as goodwill that is not allowable for
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should your test for unrecorded liabilities be affected by the fact that a letter is obtained in which a responsible management official certifies that to the test of his knowledge
Communication with the expert If the auditor intends to use the work of an expert then he must communicate with the expert well in advance to confirm the terms of engagement an
Basic Elements of a Management Representation Letter Whenever requesting a management representation letter, such the auditor would request which it be addressed to the audi
Higher normal risk Several audit assignments involve high audit risk and usually in any client there will always be at least one high risk area. Indications that an audit has
Comparison of the Negative and Positive Methods Negative Method According to this method of circularisation, the customer is asked to communicate only when he does not ag
Q. Corporations generally issue stock dividends in order to a. increase the market price per share. b. exceed stockholders' dividend expectations. c. increase the marketability of
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