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Auditor will discuss

i Impairment with
Management about
Irrecoverable
Debt
IE
Im
Additional basis rate whole Irrecoverable required
worth Debt
Adjustment
←
Impairment required of using of growth of
$400,000 while estimating value $65 PBT
represents

25%
PBT 9 in It g
represents of
6- use
of of
ooo

company
,
.

038 t Assets material to rather than rate 0.061 assets oi immaterial to Fs

of factory
:
of
o
using growth of
.
. .

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Income statement but immaterial to soft As material to Fs oi auditor Cleaveland Co
Bankruptcy
issue is
Information of
. .

IM
should due to it
after
discovered the
ment
of
Boston Co use will
modify
his opinion was YIE :
.

.
o

growth
rate
of affected factories II Borrowing Cost it will be
regarded as
subsequent

Farage
HE
while estimating value in Finance
charge which should be
capitalized event However it will be an
specifically
.

used rate Co worth $75000 represents lift PBT 9 event relates

adjusting
use as as
They growth of of information
.
. .

a whole which is G has 0.072% assets oi immaterial to FS to debt which existed at YIE
wrong
.

, of
Im HE
overstated value in
=
Construction plant Additional allowance $65,000 is
of req
use
@adoring
new man is
.

of
.

IM
←
Growth rate reduces 9 asset per Ins 23 Cleaveland Co debt debt
against
as
qualifying
as
of factory specifically Borrowing
.

,
,

$400,000 revised Cost $100,000 out $30000

by
value As because it which
in use is
apparently taking more was
of of
.

value in is $3 Im than I in
completion Project started were paid G rest were subject to
year
use
still was
'

is
.

filed
FU cost to the YIE it Bad debt Cleaveland Co
than less sell 31 Dec 015 3 expected as
during
is
higher of
.

Recoverable $3 im Allowance
43M i amount will be to complete in Nou 016
bankruptcy in subsequent period
. .
. .
.

'

EAS
CV asset Construction Plant 5T debt 45,000 already
$3 .com but
of of iz is
of
was
originally Manejacturing
is a
Of
.

asset to its booked do $65000 to

has been already impaired qualifying
asset o
: interest should be
additionally needs

$3 's 'm amount has it be booked $79000 recieuabk

recoverable
using wrong
value capitalized .

Management wrongly charged against

in Additional impairment of $400 to PGL Uls 9 assets of Cleaveland Failure to record bad
use which Profit
.
.
.
ooo .

is to asset to its correct As misstatement immaterial to Fs : debt will Ols G Debtors

required bring is o
Profits .

im
$3 im Failure to will not his It to be with
recoverable amount
of
.

auditor modify opinion needs discussed

Management

record it will Ols Profits G assets .

due to individually .
that if there are
any further correspondence
 with Cleaveland Co which basis Overall Impact
are
of
.

not additional allowance IF all misstatements are considered

recording
. on

As immaterial then misstated

misstatement is to Fs o :
aggregate Profits are
by
it will not audit $346,500 which
represents 5.4 't PBT
affect opinion individually .

of

II financial Asset o
: material to Fs .
Further Assets are

F-
misstated immaterial
required also
$43,500 0-33-1 :
Adjustment worth represents by
. o

0.68T PBT 9 0.0421 assets : to SOFP

of of
.
o .

immaterial to FS Auditor audit

will express modified
.

¥
Investment in
Nebraska Co. misstatements material
shares was
opinion as are

valued at FV PGL : it should but not pervasive to FS He will state

through
. .

that FS true G all material

be to
fair
revalued its Fu at each end is in
year
misstatements discussed
with
gain
9 loss recorded in Per .

aspect except for

at them in Basis
Management
has
wrongly valued Cost .

of modified opinion para .

HE
Fu shares at end
para will to
Heading of opinion
was
of year change
150,000 $4 E
shares x 29=4643,500 whereas
modified opinion heading of basis
of
'

their Cost 150,000 shares $4 $600000 will to Basis

was x
opinion para change of Modified
-
-

: Fu $43,500 will be recorded opinion

gain of
.
o

PEL A will be added Basis

in
, along
with rise in value
of
sub
para in
of
investment 's to record
.

Management failure modified opinion para in which auditor will

has 9 assets
gain
Us Profits .

give
detail about misstatements which resulted

As misstatement is immaterial to Fs : Amounts misstatements

modification of opinion
in
of
o
.

audit Heads with

opinion will remain
unmodified affected will be
given along
detail of issue G adjustments .
 December 2016 =
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§ Impact on
future engagements
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Page 125 149
of 416

,
 Im
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Research $7m Auditor discuss this limitation Auditor
CAI Military Project worth will on
scope will
inform
Tewes about inclusion

with G them Para

10851078%
assets
PBT Management will

material
represents g convince Eom in audit report As
per
of of of
.

do to FS to evidences that standard discuss

.

provide supporting ,
so
auditing ,
auditor should

IM=
restriction to limitation resolved with
Management provide details on scope is
Sufficient Tewes
before modifying audit report
.
.

will
about Milla
try research project supporting evidence will be needed
from Lastly Auditor should review that

create limitation auditor

a on
scope for
.

Management ,
which can include extracts
of Management disclosure
of
this event

Auditor unable to G contract not complete variation

is
get sufficient
as evidence ,

if sufficiently explains major

in

appropriate audit evidence contract Crow co PBT has declined

only
as
performance of
.
.

about this Fire Assets have declined

information project is
management
by
411 . 3

comment it lucrative
contract Fire has resulted event 29 't IF disclosure incomplete
by
a as is
being significant
a
of
.
.

EAS
I
limitation that

It
material but to misstated
for
Crow Co
on
scope is . as
operations were ceased Notes Fs will be .

not pervasive to FS : auditor will several months further operations have

express modified
for
a .

opinion state that Fs resumed G will take

fully
he still not six
IE will

true G material months

presents fair view in all more .

aspects except limitation scope Auditor will this matter Emphasis

for refer
a on in

discussed Basis Matter it

in
of modified opinion on
Paragraph as is a
significant

para .
matter to Shareholders G it has been

IM
uditor will
heading of opinion para correctly disclosed in Fs Auditor will
change .

give
to
opinion 9 Basis to disclosure Fs to
Modified heading g of reference of which relates

to Basis this event

opinion para of Modified opinion
.
.

Further Eom
he will
give
a sub para in Paragraph will be
placed after
Basis

Basis opinion para to explain opinion in Crow co Audit report

of Modified Modified
.

Of
.

in It will be
before KAM Para
of modification
reason opinion .
.