Task 01

2007 Comprehensive Question 2 Company W is mainly engaged in the production and sales of small electronic consumer goods. Product sales are delivered to Company W’s warehouse. W Company's daily transactions are conducted using a combination of automated information systems (hereinafter referred to as systems) and manual control. The system has not changed since 20×6. Company W's products are mainly sold to consumer electronics dealers in major domestic cities. Certified public accountants A and B are responsible for auditing Company W's 20×7 financial statements.

Information 1: CPAs A and B recorded what they knew about Company W and its environment in their audit working papers. Part of the content is excerpted as follows:

(1) In 20 On the basis of achieving a sales revenue growth of 10% in ×6, W Company’s board of directors set a sales revenue growth target of 20% in 20×7. Company W's management implements an annual salary system, and the overall salary level fluctuates based on the completion of the above goals. The average sales growth rate of Company W's industry in 20×7 was 12%.

(2) The financial director of Company W has worked for Company W for more than 6 years. After the labor contract expired in September 20×7, he was hired by a competitor of Company W with a high salary. Due to high work pressure, staff in the accounting department of W Company are subject to frequent turnover. Except for the accounting supervisor, whose service period exceeds 4 years, the average service period of the other personnel is less than 2 years.

(3) Company W’s products are facing the pressure of rapid replacement, and the market competition is fierce. In order to consolidate its market share, Company W reduced the sales of its main product (Product C) by 8% to 10% in April 20×7. In addition, Company W launched product D (an improved model of product C) in August 20×7, which performed well in the market. It plans to fully expand production in 20×8 and stop the production of product C in January 20×8. . In order to speed up the flow of funds, Company W began to implement a new round of price reduction promotions for product C in January 20×8, with the average price reduction reaching 10%.

(4) Products sold by Company W are transported by external transportation companies approved by the customer. The freight is borne by Company W, but the risk during transportation is still borne by the customer. Due to the impact of rising energy prices, the transportation unit price in 20×7 increased by an average of 15% compared with the previous year, but the transporters agreed to extend the freight settlement cycle from the original 30 days to 60 days.

(5) In 20×7, the prices of main raw materials of Company W were basically the same as those of the previous year, and there were no major changes in suppliers. However, due to changes in technical requirements, product D consumed more high-grade metal materials than C The product has increased slightly, causing the raw material cost of product D to increase by 3% compared to product C.

(6) Except for the 2-year bank loan of 50 million yuan with an annual interest rate of 6% borrowed in December 20×6, W Company has no other borrowings. The above-mentioned long-term loan is specifically used to expand an existing production line to meet the production needs of product D. The production line has a total investment of 65 million yuan. Construction started in December 20×6 and was completed and put into use in July 20×7. (Assuming interest income is not considered)

Reference answer

Event number Whether it may indicate that there is a risk of material misstatement (yes/no) Reason Does the risk of material misstatement belong to the financial statement level or the identification level? (Financial statement level/identification level) Transaction or account name and identification

(1) Yes In order to achieve a sales growth rate higher than the industry average growth rate of 8% determined by the management of W company, and management The salary of the first-level employees is linked to the sales growth target, so the income may be inflated

Recognition level

①Operating income/occurrence

②Accounts receivable/ Exists

(2) Yes Changes in key personnel of Company W, as well as frequent changes in accounting personnel and lack of competent accounting personnel, may lead to the risk of material misstatement Financial statement level

(3) Yes The gross profit margin of product C in 20×7 was 8.1% [(18500-17000)/18500×100%]. However, after the price was lowered by 10% in January 20×8, product C’s The net realizable value will be less than its cost, and there is a high risk of overestimating the inventory cost. Recognition level ① Inventory/valuation and apportionment

②Asset impairment loss/integrity

(4 ) Yes ① The total sales volume of products in 20×7 is greater than that in 20×6, and the transportation unit price has increased by 15% on average, but the transportation fee has only increased by 4.3% [(1200-1150)/1150×100%]. There may be an underestimation20 ×7 years of transportation cost risk.

②There is no major change in transportation expenses in 20×7, which may indicate that sales volume has not changed much and sales revenue is overestimated. Identification level ①Sales expenses/completeness

②Accounts payable /Completeness

③Operating income/occurrence

④Accounts receivable/exist

(5) No

(6) Yes. The project was completed in July, but the interest for 10 months [250/(300/12)] was capitalized. It is very likely that the cost of fixed assets has been overestimated and the financial expenses for 20×7 have been underestimated. Identification level ① Fixed assets/valuation and allocation

②Financial expenses/completeness

Task 02

Information At 9:00 am on January 15, 2009, the auditors reviewed NL Conduct an unannounced audit of the company's cash on hand. After counting, the actual inventory situation is as follows:

(1) Cash includes: 9 100 yuan coins, 15 50 yuan coins, 20 10 yuan coins, 50 5 yuan coins, 40 2 yuan coins There are 20 1-yuan coins, 10 50-cent coins, 10 2-cent coins, and 15 1-cent coins.

(2) There are 3 income vouchers that have not yet been recorded, totaling 2,520.00 yuan;

(3) There are 5 expenditure vouchers that have not yet been recorded, totaling 1,556.00 yuan, of which the payment procedures are not 2 complete payment vouchers, totaling 1,200.00 yuan. The book balance of cash on hand on the inventory date (January 15th) was 1,244.5 yuan. From January 1, 2009 to the inventory date, the income was 3,226.00 yuan and the expenditure was 3,075.82 yuan. The book balance of cash on hand on December 31, 2008 was 1,981.32 yuan.

Please prepare a cash inventory list for NL Company, point out any problems in cash management of the unit, and provide audit opinions.

Reference answer:

Inventory cash count table

Audited unit: NL Company Page: Index:

Counting date: 2009 January 15, 2009 Preparer: Date:

Reviewer: Date

Item Amount Remarks

(1) Book balance on January 15, 2009 1244.50

Add: Income at the time of inventory 2520.00

Subtract: Expenditure at the time of inventory 1556.00

Among them, IOUs are 1,200 yuan

(2) The total amount that should be kept in the books at the time of the inventory is 2208.50

(3) The actual amount at the time of the inventory 2208.50

Add: expenditures from January 1 of this year to the time of the inventory 3075.82

Less: Income from January 1 of this year to the time of inventory 3226.00

(4) Calculated actual balance on December 31 of the previous year 2058.32

(5) December 31 of the previous year Book balance 1981.32

(6) Profit and loss balance 77 Insufficient procedures

Task 03

Data auditors usually rely on various transactions, account balances and reported Relevant identification determines the audit objectives and designs audit procedures based on the audit objectives. The following are relevant audit objectives in the purchase and payment cycle and list some substantive procedures.

(1) Audit objectives

A. The recorded procurement transactions and events have occurred and are related to the audited unit.

B. All procurement transactions and matters that should be recorded have been recorded.

C. Amounts and other data related to procurement transactions and events are appropriately recorded.

D. Purchase transactions and events are recorded in the appropriate accounts.

E. Purchase transactions have been recorded in the correct accounting period.

(2) Substantive procedures

1. Compare the transactions recorded in the purchase ledger with the purchase invoice, acceptance form and other supporting documents.

2. Refer to the purchase invoice and compare the classifications on the chart of accounts.

3. Trace the purchase invoice to the purchase detailed account.

4. Trace from the acceptance document to the purchasing detailed account.

5. Compare the dates on the acceptance form and purchase invoice with the dates in the purchase ledger.

6. Check the rationality and authenticity of purchase invoices, acceptance forms, order forms and purchase requisitions.

7. Trace inventory purchases to inventory perpetual inventory records.

Please analyze and answer the following questions based on the above information:

(1) According to the audit objectives given in the question, indicate the corresponding relevant determinations.

(2) For each audit objective, select the corresponding substantive procedures.

Reference answer:

Relevant assertions Audit objectives (known) Substantive procedures

Occurrence The recorded procurement transaction has occurred and is related to the audited unit 1, 6, 7

Completeness All purchase transactions and matters that should be recorded have been recorded 3, 4

Accuracy Amounts and other data related to purchase transactions have been appropriately recorded 1

Classification The purchase transaction has been recorded in the appropriate account 2

Closing The purchase transaction has been recorded in the correct accounting period 5

04 Task

Information ABC Accounting Firm has accepted the entrustment of a manufacturing company on December 6 to audit its annual financial statements. The general manager of the company said that the company had conducted a comprehensive inventory inventory on November 25. However, because Ma Mou, a certified public accountant from M Accounting Firm who had been engaged in the company's annual audit over the years, had resigned, the inventory inventory on November 25 had not yet been completed. According to on-site observation by a certified public accountant, Ma's resignation was also the main reason why the company changed its entrustment to ABC Firm. The general manager of the company did not agree to stop work again to take inventory because the delivery date of the products was approaching, but all the information in the inventory on November 25 was available for review. Certified public accountants from ABC Accounting Firm had an in-depth understanding of and tested the internal control of the company's inventory and believed it to be relatively sound and effective; they checked the company's inventory data in detail, and on December 31, they took a count of approximately 10% of the total inventory value. For 10% of the projects, the perpetual inventory records of selected projects were traced, and no major differences were found. On December 31, the company's total assets were 27 million yuan, with inventory reaching 13 million yuan.

Requirement: If no material misstatement is found in the audit of other items in the financial statements, can the CPA issue an unqualified audit report? Please explain whether the CPA issues an unqualified or non-unqualified audit report Reasons for reporting.

Answer

Reference answer:

In this case, the CPA cannot issue an unqualified audit report. Because observing the inventory count of the audited unit is the most important step in the inventory audit, the audited unit does not agree to the CPA's implementation of the inventory. When the inventory accounts for a considerable proportion of total assets, it can be considered a major restriction on the scope of the audit. The audited unit has conducted its own inventory on November 25, and the delivery date of the audited unit is approaching. This cannot be an excuse for the CPA to be unable to observe the inventory count audit procedures of the audited unit. The unit under audit should change the entrustment before November 25 so that the certified public accountants of ABC Accounting Firm can observe the inventory count on November 25. At the same time, ABC Accounting Firm should pay attention to the change of entrustment of the audited unit to avoid fraud. Because Ma's resignation is not enough to cause the audited unit to change its entrustment to another accounting firm, ABC Accounting Firm should insist on implementing inventory supervision again. . It can be arranged on or after December 31, otherwise an unqualified audit report shall not be issued.

05 Task

Information Yuehua Accounting Firm issued an explanatory statement in the audit report of the 2003 annual report of Petroleum Longchang (600772). The report pointed out that the transfer procedures for the 158 million yuan property purchased by the company in Oasis Plaza were in progress as of the reporting date. Wuhan Oasis Enterprise (Group) Co., Ltd. failed to complete the renovation of this part of the property as scheduled, and liquidated damages have been calculated and collected in accordance with the contract. In addition, the report indicates that China Petroleum Pipeline Industrial Investment and Development Co., Ltd., in which the company holds 10% of the shares, owes the company a total of 49.17 million yuan, and the company has also provided it with a loan guarantee of 15.3 million yuan.

As of February 2005, Wuhan Oasis held 8.9% of Petroleum Longchang's shares and was the company's third largest shareholder. The board of directors of Petroleum Longchang stated in the annual report that the company is actively urging Wuhan Oasis to handle the transfer procedures of the Oasis Plaza property as soon as possible, and has collected liquidated damages of 11.36 million yuan from it in accordance with the provisions of the agreement. In the first half of 2004, the company charged another RMB 5.68 million in liquidated damages. In addition, China Petroleum Pipeline Industrial Investment and Development Co., Ltd. has formulated a repayment plan for the company's arrears. According to the plan, the company has repaid the arrears of 20 million yuan on April 5, 2004.

The annual report correction announcement of Petroleum Longchang on February 3, 2005 stated that Yuehua Accounting Firm had modified the original audit report, and the revised audit report was a standard unqualified opinion. The announcement emphasized that the above modifications had no impact on other contents in the company's 2003 annual report. (Excerpted from "China Securities Journal" on February 3, 2005, author: Wanning)

Please think and analyze the following issues based on the above background materials:

(1) Petroleum Dragon What is the basis for the change of audit opinion in Chang's annual report?

(2) Is this change an audit failure?

(3) Will the above modifications have any impact on other contents in the company’s 2003 annual report?

Reference answer:

(1) According to the provisions of the Chinese Independent Auditing Standards for Certified Public Accountants, certified public accountants can only audit listed companies when they involve major uncertainties and matters that endanger the company’s continued operations. , can issue an unqualified audit report with explanation. The matters highlighted in the unqualified audit opinion with explanatory notes issued by Yuehua Accounting Firm for the company in 2003 were inconsistent with the relevant requirements stipulated in the Independent Auditing Standards for Chinese Certified Public Accountants.

It is necessary to change the audit opinion of the annual report.

(2) Audit failure means that the auditor fails to discover the falsehoods in finance, financial revenue and expenditure and financial statements, and fails to pass the system in the business activities of enterprises and institutions. , standardize audit methods, evaluate and improve the organization's risk management and organization operations, and issue or disclose audit opinions, which causes audit disputes and leads to the failure of the audit image. Accordingly, the above changes are not audit failures.

(3) The above modifications have no impact on other contents in the company's 2003 annual report.

06 Task

Information On January 20, 2010, M Accounting Firm completed the review of ABC Company's 2009 accounting statements. During the review process, the auditors learned about ABC Company and its environment; they inquired about the accounting standards and related accounting systems adopted by ABC Company, and made focused inquiries on the recognition, measurement and reporting of transactions and events. The management of ABC Company told the auditors that because the net realizable value of the inventory was difficult to determine, the inventory was valued at cost at the end of the period, and the auditors found that there were signs of impairment in its inventory.

Please analyze and answer the following questions based on the above materials:

(1) If the auditor makes an unqualified conclusion on the financial statements reviewed, what conditions should be met at the same time?

(2) Assuming that the above error is material, what type of review conclusion might the auditor issue?

(3) If a review report with reserved conclusions should be issued, please issue a review report on behalf of the auditor.

Answer:

1. To make an unqualified conclusion on the financial statements reviewed, the following conditions must be met at the same time:

(1) The auditor has not noticed any Matters that lead to the belief that the financial statements have not been prepared in accordance with applicable accounting standards and relevant accounting systems and do not fairly reflect in all material respects the financial position, operating results and cash flows of the entity under review.

(2) The auditor has planned and implemented the review work in accordance with the provisions of the review standards and is not restricted during the review process.

2. If you notice certain matters that make you believe that the financial statements have not been prepared in accordance with applicable accounting standards and relevant accounting systems, and fail to fairly reflect the financial status and operations of the entity being reviewed in all material aspects. For results and cash flows, the CPA should add an explanatory paragraph before the conclusion paragraph of the review report to explain the impact of these matters on the financial statements and propose a qualified conclusion. If the impact of these matters on the financial statements is so material and pervasive that a qualified conclusion alone is not sufficient to reveal that the financial statements are misleading or incomplete, the CPA should issue an adverse conclusion that the financial statements do not comply with the applicable requirements. The preparation of accounting standards and related accounting systems fails to fairly reflect the financial position, operating results and cash flows of the entity under review in all material aspects.

3. Review report

All shareholders of ABC Co., Ltd.:

We have reviewed the attached financial statements of ABC Co., Ltd. (hereinafter referred to as ABC Company) , including the balance sheet as of December 31, 2009, the income statement, statement of changes in shareholders' equity, cash flow statement and notes to the financial statements for 2009. The preparation of these financial statements is the responsibility of ABC Company's management, and our responsibility is to issue a review report on these financial statements based on the implementation of the review work.

We performed the review business in accordance with the provisions of "Chinese Certified Public Accountant Review Standards No. 2101 - Review of Financial Statements". The standard requires us to plan and perform a review to obtain limited assurance about whether the financial statements are free of material misstatement. A review is primarily limited to questioning company personnel and performing analytical procedures on financial data, providing a lower level of assurance than an audit. We have not performed an audit and therefore do not express an audit opinion.

ABC Company management informed us that inventories are valued at a cost higher than net realizable value. The calculation sheet prepared by the management of ABC Company and reviewed by us shows that if it is valued according to the lower of cost and net realizable value stipulated in the Accounting Standards for Business Enterprises, the book value of the inventory will be reduced by X yuan, and the net profit and shareholders' equity will be reduced by X yuan. .

Based on our review, except for the impact of the above-mentioned overestimation of inventory value, we have not noticed anything that leads us to believe that the financial statements have not been prepared in accordance with applicable accounting standards and relevant accounting systems. Ability to fairly reflect, in all material respects, the financial position, operating results and cash flows of the entity under review.

XYZ Accounting Firm (seal) Chinese Certified Public Accountant: ×× (signature and seal)

Chinese Certified Public Accountant: ×× (signature and seal)

China ×× City January 20, 2010