Only take this quiz once you have watched the Osteology Refresher video. We also recommend reading pages 55, 59-63, and 68 in your Merrill’s textbook (volume 1). You have three attempts to earn 100% on this quiz. If you do not achieve 100% on one of your three attempts, your highest score will be recorded.

Identify two of the main users of these financial statements. Comment on what area of the financial statements each party would be MOST interested in, and describe why. Be as specific as possible, and link to the case facts provided (generic responses that are not specific to this case will not be awarded any marks). (4 marks)

A junior staff member makes the following comment to you about the audit plan: “I think this a very high risk engagement; therefore materiality should be very high”. Is this staff member correct about setting materiality high? Fully explain your reasoning. (2 marks)

Describe two factors that you considered when assessing acceptable audit risk for this audit. Be sure to link to the case facts provided (generic responses that are not specific to this case will not be awarded any marks). (4 marks)

Comment on the most appropriate base you would use to calculate materiality, and use it to calculate overall materiality for the current year’s audit. Be sure to explain why you chose the base you did, and justify ALL parts of your calculation. Be sure to show your detailed calculation and make an overall conclusion, including any qualitative factors you considered. (8 marks) Recall that the most common bases used are as follows: 3 – 7% of pre-tax profit (net income before taxes) 1 – 3% of total assets 3 – 5% of shareholders’ equity 1 – 3% of revenues or expenses I’ve included another copy of the client’s trial balance for you (below). 

Describe the risk associated with obtaining sufficient audit evidence over completeness of revenues for Tiger Pro Golf Ltd. Then, describe a substantive audit procedure you could perform during the audit of Tiger Pro Golf Ltd. that would provide you with audit evidence over completeness of revenues. Be sure to link to the case facts provided (generic responses that are not specific to this case will not be awarded any marks). (3 marks)

If the auditor decided that inherent risk should be assessed as ‘high’ rather than ‘low’, this would _______________ the sample size.

If the auditor decided that he/she could no longer rely on controls over this account, this would _______________ the sample size.

If the auditor decided to increase Acceptable Audit Risk, this would _______________ the sample size.

Describe two significant internal control strengths. For each control strength, explain how the control would prevent, detect, or correct errors. Then describe how you (as an auditor of Tiger Pro Golf Ltd.) would test the control. Be sure to link to the case facts provided (generic responses that are not specific to this case will not be awarded any marks). (8 marks)           Note: only the first two will be marked. Note: Do not click anywhere outside of the tables below. If you accidentally delete a template, you can try to undo it by holding down both the ‘Ctrl’ and ‘z’ keys. If that doesn’t work, you’ll need to continue on without the template in the blank space. No time extensions or grade allowances will be given for this. You may find it useful to use this ‘full screen’ icon while inputting your responses: