Financial Decision for Creative Projects-Free-Samples for Students

Questions: 1.While Performing an audit what kind of Observation an auditor should perform for the Physical Inventory Count. Explain relevant procedures in your own words and give examples? 2.Explain in detail the Inherent Risks Factors are involved while assessing the Risks for the Intangible Assets? 3.Clarify in detail what are substantive analytical procedures can be used in the audit of property, plant, and equipment? 4.Describe in detail the substantive analytical procedures can be used in auditing the Income statements? Answers: 1.There are few substantive and analytical procedures that the auditor must perform while conducting the physical count of inventory like test checking the presence of the same in the register. The auditor must see that all the inventories are tagged separately and are accounted for accordingly(Alexander, 2016). If there is inventory present at several locations, then that locations where the maximum portion of the same is there must be checked. After all the checking reconciliation must be done. Sample check is the most common method that is applied to check the validity of a particular population.For example, if there are 10000 item of inventory then sample test can be done on certain items to know the feature of the entire population. If the company is having stock at three locations A. B and C then the auditor should audit that portion where there is the maximum inventory stored out of the three. 2.In case of intangible assets few inherent risk factors that are present are- If there are changes in the overall technological scenario then the development of the asset might get affected. It is difficult to conduct audit transactions in case of an intangible asset. Few accounting issues that are involved in case of the same are of complex nature like valuation of impairment cost, ascertainment of fair value etc(Bromwich Scapens, 2016). 3.Few substantive analytical procedures that can applied in case of plant property and equipment are The auditor must choose an assertion that will reflect the current position of the assets while studying the year-end balance, like completeness, valuation and other various aspects covered in valuation(Drew, 2017). The auditor must take steps to identify the risk element that might be involved in case of such audits and try to reduce it to minimum level. 4.In case of auditing the income statement, the auditor must apply methods that will help them identifying any deviations in the statement from the actual present financial state of the company. The auditor must see to it that the financial statement is related to the period for which it is specified, then the auditor must check the accuracy of the same by studying each element separately(Visinescu, et al., 2017). References Alexander, F., 2016. The Changing Face of Accountability. The Journal of Higher Education, 71(4), pp. 411-431. Bromwich, M. Scapens, R., 2016. Management Accounting Research: 25 years on. Management Accounting Research, Volume 31, pp. 1-9. Drew, J., 2017. IASB proposes changes around accounting policies and estimates. Journal Of Accountancy. Visinescu, L., Jones, M. Sidorova, A., 2017. Improving Decision Quality: The Role of Business Intelligence. Journal of Computer Information Systems, 57(1), pp. 58-66.