Professional Documents
Culture Documents
- Re-calculate the carrying value of a sample of PPE and verify that it does not differ
materially from the fair value
- Discuss with the finance director the reason for updating the carrying value of all PPE
-Inspect the board minutes to ascertain the valuer expertise and its relevant professional
qualifictions
- Inspect the revaluation of PPE and identify any revaluation losses. re-calculate the carrying
value of PPE and agree the amount in the statemenent of profit and loss.
-re-calculate depreciation charges at year end to ascertain that depreciation was charged on
the revalued amount less residual value.
-Inspect the valuer review and identify any revaluation gains. Re-calculate the gains and
agree the amount to revaluation reserves.
-Discuss with the valuer if the revaluation of PPE was adequately undertaken and discosed
in line with IAS 16.
Inventory valuation:
- Inspect a sample of sale invoices post year end and ascertain that goods sold NRV is above
cost. If not, request an adjustment.
-obtain a breakdown of E243 costs and agree those to the relevant invoices.
-Inspect post year-end sales invoices and ascertain if E243 was sold for $400.000.
-if E243 was sold at $400.000, verify that the residual loss of $320.000 (720.000-400.000)
has been written off.
-Obtain a breakdown of of finished goods standard costs and agree those to labour hours
and raw material costs.
-Discuss with management the basis of E243 standard cost being revalued at $400.000
- inspect previous year-end inventory listing and identify any slow-moving inventory that
might require to be adjsuted at year end.
Bank loan:
- request the bank letter confirmation and agree repayments made by Elounda Co as
reported in the bank statements.
- Inspect board meeting and verify if any concern related to the loan repayments was raised.
-Inspect the bank confirmation letter and identify any late payment covenants and
breaches.
-re-calculate the split between current and non-current liabilities to verify allocation of the
bank loan.