Assignment: Advanced Auditing and Assurance
This assignment is to be based on Metcash Limited (ASX code-MTS).
The objective of this assignment is to test students' ability to integrate skills learnt in Advanced Auditing and Assurance to analyse a real company from the auditor's perspective.
The successful completion of this assignment requires extensive research on Metcash's internal and external environments, operations, strategies and analysis of annual reports.
Students are expected to demonstrate their ability to critically evaluate information relating to Metcash Ltd. and apply analytical skills to identify potential audit risks.
This assignment represents 20% of the total assessment of this subject.
Length and format
The assignment shall be presented in the below format:
A table of contents, An executive summary , The build of the assignment (MS word, Maximum 2,000 words (excluding references and appendices), Times New Roman, Size 12 font, double spacing). Use of headings, tables and graphs is encouraged. Appropriate reference citations throughout the assignment is expected , and References
Failure to meet the above length and format requirements will incur a 5 mark penalty.
1. You are a part of the team responsible for planning the Metcash (parent and the consolidated economic entity) audit engagement for 2017. You have been assigned to gather relevant background information and prepare a report for a meeting with your audit partner and audit managers. Your report must address the following issues:
a. What are the areas in which Metcash conducts its operations? b. Which particular laws/regulations (other than financial related categories which include legislations such as: Corporation Act 2001, Australian taxation laws, etc.) affect its operations? You need to identify at least FIVE laws/regulations. c. Who are its primary competitors?
2. Identify and explain FIVE significant business risk factors that the auditor needs to consider for the Metcash group engagement.
3. Identify at least FOUR accounts susceptible to misappropriation or fraudulent financial reporting within the Metcash Group and explain why. Your answers should be reflective of your in-depth understanding of Metcash Group and its environment.
4. With specific reference to Metcash's corporate governance arrangements, you need to assess the likelihood of the potential reliance that could be placed on the overall control environment. Your conclusion should be supported by at least FIVE factors.
5. Recently Metcash showed its intentions to acquire Woolworth's Home Timber and Hardware business for about $250 million. The Australian Competition and Consumer Commission (ACCC) have also given approval to bid for Home Timber and Hardware business. How will the development of the proposed acquisition of Woolworth's Home Timber and Hardware business affect your 2017audit plan for Metcash?