1. Audit Committee is an operating committee that responsible to overseethefinancial reporting and governance processes.

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1. Audit Committee is an operating committee that responsible to
overseethefinancial reporting and governance processes. As stated
under Bursa MalaysiaListing Requirements, all companies listed in
Bursa Malaysia should establishtheir own Audit Committee.
Discuss THREE (3) benefits and THREE (3) drawbacks of
establishment audit committee in an organization.
2. Internal auditors’ roles include monitoring, assessing
and analyzing organizationrisk and controls as well as confirming
information related to the policies, procedures and laws. Thus, the
work of internal auditor complements the workof the external
auditor.
(a) Identify any FOUR (4) similarities function between
internal audit andexternal audit
(b) Explain THREE (3) benefits and THREE (3) drawbacks
of establishment internal auditing department.
3. The International Standards on Auditing (ISA) 600 applies to
group audits andspecial considerations that involve component
auditors. The group engagement partner or principal auditor decides
whether the group engagement teamor acomponent auditor will perform
the work on the financial information of acomponent
auditor.
(a) Give FOUR (4) factors that need to be considered by
principal auditor when planning to rely on the work of component
auditor.
(b) Discuss any TWO (2) additional reporting
requirements made by principal auditor when it comes to consol all
group’s financial statements.
4. You are the audit manager in charge of ABC Sdn. Bhd. (ABC), a
company which is involve in supplying medical equipment for the
elderly people. Inplanning the audit for the year ended 30
September 2021, the followinginformation was made available to
you.
ABC Sdn. Bhd. has supplied the medical equipment to both
privateandgovernment hospitals on credit terms. Due to economic
downturn, ABChas beensuffering the increasing level of bad debts as
collections from the government arerelatively slow. The management
of ABC plans to expand its business overseas, particularly in
Singapore and Indonesia. As part of the plan, the management also
looking into the upgrading of its accounting system frommanual
tocomputerized system. This plan will reduce the staff cost
substantially. However, ABC has trade receivables balance that is
material to the financial statements.
Required:
From the information given, explain risks associated
with the audit of ABCSdn. Bhd.
Explain Type error 1 and Type error 2 that could be
happened duringfinalising audit issuance decision
making.