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QUESTION 1
Part A
Government has recently set up a parasternal body responsible for the management of land in Mauritius. The management is unsure as to the need for an audit. The Director of Audit, the auditor of the body, has asked you to visit the client and explain to management the more fundamental aspects of the accountability of the body.Required:
(a) Explain to management what an audit is.
(b) Briefly describe the following types of audit
(i) Performance audit
(ii) Management audit
(iii) Internal audit
(c) Explain how management audit differs from financial audit
(d) Statutory audits are audits carried out because the laws require them.
State five benefits of a statutory audit
Part B
(a) The conduct of auditors should be beyond reproach at all times and in all circumstances. Briefly explain the four principles that auditors should apply and uphold
(b) Explain how the objectivity of the external auditor may be threatened or appear to be threatened if the firm, its partners or staff have any financial interest in an audit client.
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