Digital Valley Sdn Bhd (DVSB), a software developer, is one of the subsidiaries of Technopro Bhd (TB). In the course of
Posted: Fri Jul 01, 2022 8:47 am
Digital Valley Sdn Bhd (DVSB), a software developer, is one ofthe subsidiaries of Technopro Bhd
(TB). In the course of consolidating the group accounts, it wasnoted that the financial statement of
DVSB was modified due to inappropriate evidence obtained inrelation to company's accounts
receivable.
The auditors were not able to verify the balance of accountreceivable of DVSB's as they did not
receive full cooperation from the management of DVSB. Theaccount receivable makes up 30% of
the company's current assets. Due to poor documentation of auditworking papers prepared by
DVSB's auditor, the group engagement partner was unable toverify the percentage of misstatement
related to account receivable.
1. Explain the audit procedures that are required to beperformed by the group engagement partner in order to address theabove issues
2. Explain the type of opinion to be issued by the groupengagement partner for the group's financial statements.
(TB). In the course of consolidating the group accounts, it wasnoted that the financial statement of
DVSB was modified due to inappropriate evidence obtained inrelation to company's accounts
receivable.
The auditors were not able to verify the balance of accountreceivable of DVSB's as they did not
receive full cooperation from the management of DVSB. Theaccount receivable makes up 30% of
the company's current assets. Due to poor documentation of auditworking papers prepared by
DVSB's auditor, the group engagement partner was unable toverify the percentage of misstatement
related to account receivable.
1. Explain the audit procedures that are required to beperformed by the group engagement partner in order to address theabove issues
2. Explain the type of opinion to be issued by the groupengagement partner for the group's financial statements.