Nama : Dodi Prasetya

NIM : 19080694039
Kelas : Akuntansi 2019I

AUDIT’S TASK

1. What kind of documents should be obtained by the auditor as evidence of client’s

governance?
The important governance information to be gathered from the client includes:
 Legal Letter
Is a primary procedure that auditors rely on for discovering litigation, claims and
assessments that affect the client is a letter from the client’s legal counsel. Auditors
analyze client legal expense for the present year and sometimes the prior years. The
auditor requires that the client send a standard attorney letter to every legal adviser.
The letter goes to both outside counsel (independent law firms) and inside general
counsel (lawyers that are employees of the client).

 Management Representation Letter

During the course of an audit, management makes many representations to the
auditor, either unsolicited or in response to specific inquiries. When these
representations relate to matters that are material to the financial statements, the
auditor must seek corroborative audit evidence, evaluate whether the
representations made by management appear reasonable and consistent with other
audit evidence, and consider whether the individuals making the representations
are competent to do.

 Contingent Liabilities & Commitments

Audit procedures that test for contingencies are not just done in the last days of the
audit, but from the beginning. Income tax disputes, investigations by government or
industry authorities, and the amount of unused bank lines of credit are generally
known from the start of the audit. Procedures such as reviews of contracts,
correspondence, credit agreements and inquiries of management should point out
possible contingencies.

 Related Parties Transaction

Is a transfer of resources or obligations between related parties, regardless of
whether a price is charged. Two aspects of related party transactions of which an
auditor must be aware is adequate disclosure of related party transactions and the
possibility that the existence of related parties increases the risk of management
fraud.

2. Explain the similarities and differences between contingency and commitment!

 Contingent liability is a potential future obligation to an outside party for an
unknown amount resulting from the outcome of a past event. Commitments are
agreements that the entity will hold to a fixed set of conditions, such as the
purchase or sale of merchandise at a stated price, at a future date, regardless of
what happens to profits or to the economy as a whole
 The similarities from both of them is that they are future based and dependent in
nature. The major difference between commitments and contingencies is
commitment is the certain obligation non fulfillment of which results into a penalty.
 And contingency is the uncertain event which may or may not become the
obligation for the organization.

3. Explain the definition of “subsequent events” and provide a real example from Indonesian
news (write the source).
Subsequent events are transactions and other pertinent events that occurred after the
balance sheet date and which affect the fair presentation or disclosure of the statements
being audited.
Ex: From PT Garuda Indonesia’s Financial Statement, The COVID-19 pandemic has created
extremely challenging business environment for Airlines globally. The COVID-19 pandemic
has severely hit Company’s operational and financial condition. Considering the challenging
situation of COVID-19 pandemic, the Company has been proposing principal and interest
payment deferral of 6 Bombardier CRJ1000 aircrafts financial lease for the period June to
December 2020 to Export Development Canada.

4. Explain the procedures to identify events that may require adjustment or disclosure in the
financial statements.
 Reviewing procedures management has established to ensure that subsequent
events are identified.
 Reading minutes of the meetings of shareholders, the board of directors and audit
and executive committees held after period end and inquiring about matters
discussed at meetings for which minutes are not yet available.
 Reading the entity’s latest available interim financial statements and, as considered
necessary and appropriate, budgets, cash flow forecasts and other related
management reports.
 Inquiring, or extending previous oral or written inquiries, of the entity’s lawyers
concerning litigation and claims.
 Inquiring of management as to whether any subsequent events have occurred which
might affect the financial statements.

5. Describe the following activities that were done as part of wrap-up procedures using your
own words
 Supervisory Review
Akuntan senior mereview pekerjaan para staf akuntan. Pada gilirannya, manajer
yang bertanggung jawab atas peninjauan Kembali pekerjaan audit yang diserahkan
oleh akuntan. Sebelum penandatanganan audit, penanggung jawab atau akuntan
senior harus memastikan bahwa semua tahapan pekerjaan telah diselesaikan sesuai
dengan rencana audit.

 Analytical Procedures
Analytical Procedures terdiri dari analisis rasio dan yang signifikan termasuk
penyelidikan fluktuasi dan hubungan yang tidak konsisten dengan informasi relevan
lainnya atau menyimpang dari jumlah yang dapat diprediksi.

 Working Papers Review

Auditor senior akan mendapatkan persetujuan dari manajer bahwa kertas kerja
sudah lengkap sebelum meninggalkan tempat klien. Ini biasanya akan melibatkan
manajer menghabiskan satu atau dua hari di kantor klien untuk meninjau kertas
kerja dan menentukan bahwa program audit sudah lengkap beserta bukti yang
diperoleh telah cukup untuk mendukung opini
 Evaluating Audit Findings for Material Misstatements
Ketika tes audit untuk setiap item dalam laporan keuangan telah selesai, staf auditor
yang melakukan program audit akan menandatangani penyelesaian langkah-langkah
dalam program audit, mengidentifikasi salah saji moneter dalam laporan keuangan,
dan mengusulkan penyesuaian untuk laporan keuangan.

 Client approval of adjusting entries

Auditor harus meninjau dan mendapatkan persetujuan klien untuk menyesuaikan
laporan keuangan sebelum mempostingnya ke neraca saldo sehingga klien sangat
menyadari entri penyesuaian apa yang dibuat dan mengapa entri itu dibuat.

 Review of laws and regulation

Auditor harus tahu hukum yang berlaku untuk klien mereka, tinjau kriteria yang
diperlukan untuk mematuhi undang-undang itu, dan menguji kepatuhan perusahaan
klien

 Evaluation of the company as a going concern

IAS 1, “Presentation of Financial Statements,” paragraphs 23 states: “Saat
menyiapkan laporan keuangan, manajemen harus membuat penilaian atas
kemampuan perusahaan untuk melanjutkan kelangsungan usahanya. Laporan
Keuangan harus disiapkan dengan basis kelangsungan hidup kecuali manajemen
bermaksud untuk melikuidasi entitas atau menghentikan perdagangan, atau tidak
memiliki alternatif realistis selain melakukannya. "