Assignment is worth 20% of the overall assessment for this subject. Due date: Week 10

Length: Maximum word limit 3000 words (including Appendices)

This assignment requires you to form a group of two (2) to develop an audit plan. You must refer to Chapter 6 of the textbook for information relating to audit planning. Your submission for this assignment must not exceed 3000 words in length. You must attach the assessment declaration sheet to the front of your assignment. You must sign and date the assessment declaration sheet. For domestic students, submission should be made as instructed below. Offshore students should follow the instructions of the local lecturer.

You must ensure the clarity of your answer and the overall presentation of your assignment. Presentation includes grammar, spelling and compliance with the word limit. You must complete your assignment in group of two (2).

Assignment must be submitted electronically and in hardcopy.

Electronic submission: must be submitted via turnitin located on webct. Anoriginality report is available to students upon submission. Note: turnitin may take up to 24 hours to produce a report. Assignment with originality report level of more than 30% may indicate that the contents have more than 30% in similarity withassignment submitted by other students OR assignment has not been properly referenced. Assignment with originality report level exceeding 30% will be penalised by four (4) marks. Students can re-submit assignment on webct as many times as necessary but the final submission both in electronic and in manual format must be made by the due date.

Hardcopy submission: must be submitted by the due date. A signed declaration formmust be attached to the front of the assignment.

Only one member of the group needs to submit the assignment. Students can submit assignment on Webct until 11:59PM on the due date. Assignments not meeting these requirements will be subjected to a penalty of four (4) marks for poor presentation. An additional penalty of two (2) marks per day will apply for late submission.

Note: Webct will not accept late submission.

Plagiarism is defined as presenting someone else’s work, including the work of other students, as one’s own. Any ideas or materials taken from another source for either written or oral use must be fully acknowledged, unless the information is common knowledge. All students are strongly advised to do the following:

–  goto http://wcf.vu.edu.au/GovernancePolicy/PDF/POA040915000.PDF

–  enter School of Accounting and Finance

–  enter Student Resources

–  read the PLAGIARISM POLICY.

The rationale for BAO3306 – Auditing as per Unit of Study Outline is that on completion of this unit students should have a sound understanding of the underlying concepts of auditing and in particular of financial auditing. By adopting a logical, structured approach they should have the capacity to analyse the salient audit issues and apply relevant auditing theories and succinctly communicate their professional, ethical decision.

One of the unit outcomes requires students to be familiar with key tools used by auditors for collecting and evaluating evidence, in both manual and computerised accounting information systems, which will enable them to express an opinion on the fair presentation of financial reports.

To ensure the audit is carried out efficiently and in a timely manner, the auditor develops an audit plan for the conduct and scope of the audit. ASA300.5 states that the auditor shall plan the audit so that the engagement will be performed in an effective manner.

1.   For the purpose of the assignment, you assume the role of an auditor and your firm has recently been appointed as external auditor of an entity. As required by Auditing Standard ASA300, you are preparing an audit plan for the audit of the entity’s financial statements.

2.     The audit fee is $92,000 and had been communicated to the client in the Engagement Letter.

3.   You are required to download the 2011 annual report published by the following entity:

ACRUX (www.acrux.com.au)

4.  Using the first four steps in the audit process as prescribed in Chapter 6 (pages 254-255) of the textbook, plan the audit for the entity you have chosen. Since you are required to develop an audit plan for a real life entity, quoting directly from textbook does not meet the objective of the assignment.

5.  Your audit plan must include the followings:

1.  Executive summary

2.  Introduction

3.  Audit plan with the following headings:

a.   Understanding the entity and its environment

b.  Understanding internal control

c.   Assessing the risks of material misstatement (for 5 key accounts)

d.  Developing responses to assessed risks (for the accounts selected above)

4.  Conclusion

5.  References

6.  Appendices