Audit Report
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- Category: Other
- Date Submitted: 11/08/2010 04:12 AM
- Pages: 4
- Report this Essay
To: Directors of the company
From: Audit Senior Manager
Date: 9th December 2009
Re: Tendering Inside The Box
The purpose of the briefing paper is to identify and discuss the issues that should be put under consideration in deciding whether or not to tender for the audit of Inside the Box.
1.0: Inside The Box (Company Background)
Inside the Box is a local United Kingdom based company in the manufacturing industry and they are listed on the London Stock Exchange.
Their main source of income derives from producing and exporting television components to one hundred thirty four countries around the world.
1.1: Financial Background
Previous year’s financial statement show annual sales amounted to ₤21,259 million billion with a profit of ₤ 11 million. Though from the audit report, the company received an unqualified audit opinion but their cash flow statement were slightly negative.
2.0: Issues and Impact
a) Resignation of the external auditors.
The reason of their resignation is due to the audit does not generate sufficient income. Logically speaking, Inside The Box is an established conglomerate in their field. It does not make sense why does the external auditors said that the charging fee’s to audit a huge corporation like Inside The Box would be too low.
There must be other reasons on their resignation. Thus, we have found that initially the relationship between the internal auditor and external auditors were quite good until they had a dispute. It is clear that both of the external and internal auditors have different opinion about the obsolete stocks.
Not only that the internal auditors wouldn’t want to speak to us but the production managers are also reluctant to speak to us.
Impact:
• Our company have major experience in auditing in the manufacturing, wholesale and retail business plus previously we have offered Inside The Box with accounting and payroll services.
• The resignation of the external...
From: Audit Senior Manager
Date: 9th December 2009
Re: Tendering Inside The Box
The purpose of the briefing paper is to identify and discuss the issues that should be put under consideration in deciding whether or not to tender for the audit of Inside the Box.
1.0: Inside The Box (Company Background)
Inside the Box is a local United Kingdom based company in the manufacturing industry and they are listed on the London Stock Exchange.
Their main source of income derives from producing and exporting television components to one hundred thirty four countries around the world.
1.1: Financial Background
Previous year’s financial statement show annual sales amounted to ₤21,259 million billion with a profit of ₤ 11 million. Though from the audit report, the company received an unqualified audit opinion but their cash flow statement were slightly negative.
2.0: Issues and Impact
a) Resignation of the external auditors.
The reason of their resignation is due to the audit does not generate sufficient income. Logically speaking, Inside The Box is an established conglomerate in their field. It does not make sense why does the external auditors said that the charging fee’s to audit a huge corporation like Inside The Box would be too low.
There must be other reasons on their resignation. Thus, we have found that initially the relationship between the internal auditor and external auditors were quite good until they had a dispute. It is clear that both of the external and internal auditors have different opinion about the obsolete stocks.
Not only that the internal auditors wouldn’t want to speak to us but the production managers are also reluctant to speak to us.
Impact:
• Our company have major experience in auditing in the manufacturing, wholesale and retail business plus previously we have offered Inside The Box with accounting and payroll services.
• The resignation of the external...