UNIVERSITY OF BOTSWANA, FACULTY OF BUSINESS

DEPARTMENT OF ACCOUNTING AND FINANCE

FIRST TEST
Course Code: ACC 309 Duration: 1¼ HOURS Date: 26 October, 2021
Title of paper: Principles of Auditing
Subject: Accounting Title of Examination: BACC, BASS, BFIN, B.Sc
(Computing and Finance)

SUGGESTED SOLUTIONS

Solution to Question One

No A B C D No A B C D
1 X 16 X
2 X 17 X
3 X 18 X
4 X 19 X
5 X 20 X
6 X 21 X
7 X 22 X
8 X 23 X
9 X 24 X
10 X 25 X
11 X 26 X
12 X 27 X
13 X 28 X
14 X 29 X
15 X 30 X

Solution to Question Two

(a) BICA rules for obtaining a practising certificate:

Before a person can practise as an auditor in Botswana:
i. S/he should be a qualified accountant, registered with BICA as an
Associate or Fellow member.
ii. S/he must have passed examinations as determined by Council
iii. S/he must have obtained adequate post qualification practical
experience under a Certified Auditor.
iv. S/he must have adequate amount of professional indemnity insurance
as determined by Council.
v. S/he must have undertaken the required Continuing Professional
Development (CPD).
 vi. S/he must state that s/he complies with the Code of Ethics as
determined by the Institute.
vii. S/he must make arrangements for the continuity of the practice in the
event of death or incapacity.
[Any 4 x 2 = 8]

(b) Elements of the system of quality control:

i. The firm should establish policies and procedures which require the
firm’s top management to assume ultimate responsibility for the firm’s
system of quality control.
ii. The firm should establish policies and procedures to ensure that the
firm and its personnel comply with relevant ethical requirements such
as fundamental principles of professional ethics.
iii. The firm should establish policies and procedures to ensure that it will
only undertake or continue relationships and engagements where it has
considered the integrity of the client, its competent to perform the
engagement, and whether it will be able to comply with ethical
requirements.
iv. The firm should establish policies and procedures to ensure that it has
sufficient personnel with the capabilities, competence, and
commitment to ethical principles.
v. The firm should establish policies and procedures to ensure that
engagements are performed in accordance with professional standards
and regulatory and legal requirements, and that the firm or the
Engagement Partner issue reports that are appropriate in the
circumstances.
vi. The firm should establish a monitoring process designed to ensure that
the policies and procedures relating to the system of quality control are
relevant, adequate, and operating effectively.
[Any 4 x 2 = 8]

(c) Duties of an Auditor:

i. To make a report in accordance with International Standards on
Auditing to the shareholders on the financial statements audited.
ii. To state whether in his opinion the financial statements give a true and
fair view and comply with International Financial Reporting Standards.
iii. To state the respects in which the financial statements fail to show a
true and fair view or to comply with International Financial Reporting
Standards.
[Any 2 x 2 = 4]