B & C Auditing Firm

Nadal Bldg, National Highway, 

Gingoog City 9014
Misamis Oriental
Region X Philippines
bgauditfirm@gmail.com

Client Name: Chimera Builders Corporation Client Code: C19-0084

Period End: Partner: Ms. Yanese P. Manager: Ms. Roshana May G.

December 31, 2021 Cullamat Berdelao

Subject : Related Parties and Prepared by: Ms. Claire M. Date:

Related Party Transactions Antido October 10,
2021

Reviewed by: Ms. Nathalie Jean Date: October

A. Batchinicha 10, 2021

Objective: This checklist sets out the audit procedures relevant to related parties and
related party transactions.

Procedure WPRe Comment

f s

Obtain the entity’s list of related parties.

Ensure that the list of related party transactions is complete by:

 Correlating the list with those charged with governance, with

key management and with shareholders
  Inquiry of management regarding related party transactions,
including obtaining support for management responses
 Reading minutes of meetings for possible previously
unidentified related parties and related party transactions.
  Considering the results of other audit procedures performed,
including possible transactions with special or abnormal
terms of trade.

With reference to supporting documents, determine the substance of

related party transactions, including whether such transactions are
conducted on arm’s length basis.

For transactions which are not arm’s length, determine if the

contracting party is a related party, and if so, whether proper
accounting and disclosure has been made.

Check for unrecorded related party transactions, such as personal

guarantees of bank loans, transactions for personal use, income or
expense shifting and smoothing, and volume discounts being given
to another entity.

Be alert for unethical reasons behind related party transactions,

such as manipulation of profit, manipulation of profit-based
incentives, reduction of taxes, cover-ups to meet bank loan
requirements.

Based on the results of tests performed, determine the additional

substantive procedures to be performed.

Ensure that related party transactions have been properly recorded,

and appropriately disclosed.

The following related parties and related party transactions have been identified and warrant
further investigation: 

Matter Proposed Tests Cleared by: Initials/Date