Audit procedures of NCA

Which of the following could confirm the existence assertion for a non-current asset?

• Agree the physical asset to the non-current asset register

• 1. Agree the physical asset to the financial statements

• Agree an entry in the non-current asset register to the physical asset

• Agree an authorised capital expenditure request form to the physical asset

 Which of the following would confirm an audit client’s right to use software that is owned by the software developer?

• 1. Inspect the end-user license agreement

• Confirm authentic user log-ins are set up to facilitate access to the software

• Agree an entry in the non-current asset register to the physical item of software installed on the entity’s hardware

• Agree value, treatment of sales tax, description and account allocation to the purchase invoice

An audit program for plant and equipment includes the following procedure:

“For a sample of additions recorded in the non-current asset register agree the details (e.g. description, amount and date) to the purchase invoice.”

Which of the following assertions is tested by this procedure?

• Completeness

• Existence

• Occurrence

• Rights

The audit strategy document has identified a risk in overstatement in the valuation of property, plant and equipment in the financial statements.

Which of the lines in Ronaldo Co’s non-current asset note must be tested for overstatement?

• 1, 2 and 6

• 1, 3 and 4

• 2, 4 and 5

• 3, 5 and 6

Audit tests to be carried out on a sample selected from a schedule of additions to Ronaldo Co’s non-current assets include the following:

Which of the following audit procedures would provide sufficient appropriate evidence to verify Rights and Obligations?

• 1. Agree additions recorded in the year to delivery received confirmation (GRN for capital items) and purchase invoice confirming invoice is in the company name

• 1. Recalculate amounts of the face of the invoice including value and treatment of tax, and agree to amounts recorded in the ledger

• If self-constructed assets, obtained cost analysis for materials, labour and overheads, and agree to supporting documentation

• Agree all additions are correctly posted to asset register