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Accf 434:Auditing Ii Question Paper

Accf 434:Auditing Ii

Course:Business Administration

Institution: Kenya Methodist University question papers

Exam Year:2012

KENYA METHODIST UNIVERSITY

END OF 2ND TRIMESTER 2012(EVENING) EXAMINATIONS
SCHOOL : BUSINESS AND ECONOMICS
DEPARTMENT : ACCOUNTING AND FINANCE
UNIT CODE : ACCF 434
UNIT TITLE : AUDITING II

TIME: 2 HOURS

Instructions:

Question One

NM audit services provision by statutory auditors has been considered as one of the major causes of lack of auditor’s independence. Discuss this statement citing relevant examples.

(10mks)

An auditor is deemed to be an investigator by the nature of his work. This has led to appointment of auditors as investigators. Explain any four reasons why you agree with this statement.

(10mks)

Explain any five challenges that an auditor may experience when auditing a group of companies.

(10mks)

Question Two

Evaluate the practicability and effectiveness of ways in which the auditor’s liability may be restricted. Give practical examples.

(10mks)

Discuss the advantages and disadvantages of claims against auditors being settled out of court.

(10mks)

Question Three

Discuss what responsibilities a statutory auditor has with regard to detection of fraud.

(6mks)

Explain how the auditor might conduct their audit in response to an assessed risk of:

Misappropriation

(7mks)

Fraudulent financial reprinting.

(7mks)

Question Four

Explain the nature and purpose of subsequent events review by statutory auditor.

(10mks)

Describe the audit procedures which may be carried out in order to identify any material subsequent events.

(10mks)

Question Five

Discuss the importance of a due diligence audit and situations in which it is conducted.

(10mks)

(i) Outline the responsibilities of the component auditor regarding cooperation with the group auditor.

(5mks)
ii) List five matters which the component auditor should communicate to the group auditor. (5mks)

Accf 434:Auditing Ii Question Paper

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