Dawood Bush: Work Sample Introduction

Case Study

Dawood Bush
Senior, RHCM
UK & Ireland Assurance
Case study background

► Fresh Taste Limited – drinks manufacturer based in the UK, with additional suppliers in Iran

► Two divisions:
► ‘Production’ of Apple Juice – Finding, pressing and mixing apple juice – selling directly to customers
► ‘Distribution’ of Orange Juice – Buying orange juice from a supplier, repackaging this with branding and selling
to commercial companies

► UK government has also introduced incentives for companies to make healthier drinks; e.g. Sugar Tax
► Recent research has shown that there have been certain suppliers falsifying ‘Organic’ drinks labelling

► Previous respectable growth in revenue year on year has been impacted by the COVID-19 pandemic,
with drinks sales reducing as more of the public stay at home (as opposed to at shops)
Task 1 – Understanding the business

Read the full detail on Fresh Taste Limited in the final slides.

If we were to audit this company, it is vital that we understand the industry that the business operates in,
and any important factors that could impact the business. To do this, we could perform a PESTLE Analysis.
(Remember: PESTLE = Political, Economic, Social, Technological, Legal, Environmental).

Please carry out your own PESTLE analysis.

What is PESTLE analysis?

► PESTLE is an acronym that stands for:

1. Political: Tax policy; environmental regulations; trade restrictions and reform; tariffs; political stability
2. Economic: Economic growth/decline; interest, exchange, inflation and wage rates; minimum wage; working
hours; unemployment (local and national); credit availability; cost of living
3. Sociological: Cultural norms and expectations; health consciousness; population growth rates; age
distribution; career attitudes; health and safety
4. Technological: New technologies are continually emerging (for example, in the fields of robotics and artificial
intelligence), and the rate of change itself is increasing. How will this affect the organisation’s products or
services?
5. Legal: Changes to legislation impacting employment, access to materials, quotas, resources, imports/exports,
and taxation
6. Environmental: Global warming and the increased need to switch to sustainable resources; ethical sourcing
(both locally and nationally), including supply chain intelligence. Pandemics and other emergencies.
► PESTLE analysis is a common technique used for analysing the impact of outside factors on an
business/organisation – allowing people to understand the ‘big picture’
Task 2 – Risks and controls

As part of the audit, we discuss the various internal processes that make the business function, with
various different members of staff at the client (both finance and non-finance staff).

Consider the stock, payroll and financial reporting processes outlined in the handout.
► What risks can you see with each of the processes?

► Why are they risks for the company?

► What controls could be put in place to help mitigate these risks?

Remember…

► Consider how much time you have to cover both tasks 1 and 2 – plan how you will split your time
before you begin
► Prepare a suitable summary for each task on PowerPoint or Word as if you were preparing the analysis
for your engagement team. The recommendation is 1 slide for the PESTLE and 1 slide for the Risks and
Controls or you may prefer to use a Word document. We will go through both tasks during the debrief.
► Task 1: Create your industry analysis clearly into the PESTLE format:
1. Political
2. Economic
3. Sociological
4. Technological
5. Legal
6. Environmental
► Task 2: Identify at least 1 risk and at least 1 control per risk for each of the 3 internal processes. Some
processes may have more than 1 risk or more than 1 control per risk.
Assurance – Case Study – ‘Fresh Taste Ltd’

Task 1

► See some information about a company below. If we were to audit this company, it is vital that we
understand the industry that the business operates in, and any important factors that could impact
the business. To do this, we could perform a PESTLE Analysis. (Remember: PESTLE = Political,
Economic, Social, Technological, Legal, Environmental). Please try to perform your own PESTLE
analysis that we will go through during the debrief.
► It is March 2022. You are on the audit team for the audit of Fresh Taste for the year to 30 June 2021.
Fresh Taste Ltd manufactures and sells its own and other company’s drinks. It has its manufacturing
base in the UK, but also has suppliers based locally in Iran (who provide their Apples). They have
recently been impacted by the COVID-19 pandemic, which has led to delays in imports for Apples and
Orange Juice.
► The company has two divisions: “Apple Juice” and “Orange Juice”. “AJ” finds its own apples, presses
these, mixes this with their specialised ingredients and sells this to customers directly (often via
online). Contrastingly, “OJ” is bought in large containers and is simply re-branded, to sell to large
commercial companies such as Universities/Hospitals; who use their own branding; not Fresh Taste.
Assurance – Case Study – ‘Fresh Taste Ltd’

Task 1 (continued)

► The UK government have also introduced a lot of incentives to companies opting to start the
manufacture of more eco-friendly manufacturing processes, so this is something that they are looking
into adopting. This would require them looking into hiring a lot more staff in the future with the right
technical know-how to manufacture the AJ in a more efficient way.
► However, recent research has shown that there have been some serious breaches in falsifying “BRIX”
certificates, which are used to provide authenticity over ingredients used. If a supplier does not hold
this, they will to be allowed to supply the UK.
► In the past, Fresh Taste have seen respectable growth in revenue year on year, however with the
COVID-19 pandemic they have been unable to sell their ‘OJ’ to universities/other retail sites and hence
have lost business in this business stream.
Assurance – Case Study – ‘Fresh Taste Ltd’

Task 2

► As part of the audit, we discuss the various internal processes that make the business function, with various
different members of staff at the client (both finance and non-finance staff). What risks could you see with the
below processes? Why is it a risk for the company? What controls could be put in place to help mitigate these
risks?
► Stock process:
► Fresh Taste have a lot of expensive stock which is stored in various warehouses/outdoor containers. This stock in the UK is
overseen by James Brown and his team of staff across the UK located at various sites. On some days, the stock staff forget to
lock the gates of the car lots but aren’t concerned as they do not think they have ever been stolen from before and believe
themselves to be in safe areas of the UK.
► Payroll:
► Payroll (the processing and payment of staff wages) is ran by Sheila Dunn, she has access to the payroll system, but she does
not have a password on the work laptop she uses. There are a lot of other office staff based in the same open-plan office as
Sheila. Employee personnel files are kept in unlocked filing cabinets near Sheila’s desk.
► Financial reporting information:
► Mark Foster is the financial accountant for the company. He is responsible for pulling together financial information on the
company for the management team to analyse. He prepares this on a monthly basis and sometimes this is reviewed by
Sarah Lodge (the financial director) but often she is too busy, so the information is submitted without review.