Asher Farm Company Case Study
First to identify the objective and responsibility of auditor we need to know what does the professional auditor do, in general the aim of reviewing financial statements for the auditor is to create an opinion and judgment on whether these statements are free from mistake or not. To do this, auditor can use the most excellent professional decision and judgment when evaluating the auditor customer information and assertions. Although every company is different here in this topic we are taking Asher Farms Company it is a fully-integrated poultry processing company that engaged in the production, also audit can be different because some time working process is unlike other company, but auditor can be able to follow some common and general procedures
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Here is how can auditor designs to meet the objectives of the audit for Asher farms.
Occurrence
when testing the accounts of the income statement for Asher Company, one of the most important and the leading objectives of the auditor is to examine the occurrence, the administration's assertion which the transactions like selling the ice pick, chill pack and frozen chicken or baying the materials they need for the company and so on, that actually took place in resulted of numbers on the income statement. This is the most relevant for revenue, since the revenue can be a threat for overstatement and the auditors will ask for evidence to see that sales have been made through bills of sales transactions.
Completeness making sure that all Asher farms company transaction and asset, liability and equity accounts is recorded. For example, to check Asher payable accounts for understatement through selecting from record balance they must never show that the account should be greater than it …show more content…
By asking our self this question we slowly will get the answer after thinking logically. Some time the firm might not be able to carry as a going concern, or may need to pay more for poultry production or could not be able to get the supplies or selling poultry from and in important markets. That is why they need to understand the nature of Asher farm, its organization, the way they work and the industry in which they participate. This understanding allows them to value which events and transactions are expected to have a significant impact on the financial
Here is how can auditor designs to meet the objectives of the audit for Asher farms.
Occurrence
when testing the accounts of the income statement for Asher Company, one of the most important and the leading objectives of the auditor is to examine the occurrence, the administration's assertion which the transactions like selling the ice pick, chill pack and frozen chicken or baying the materials they need for the company and so on, that actually took place in resulted of numbers on the income statement. This is the most relevant for revenue, since the revenue can be a threat for overstatement and the auditors will ask for evidence to see that sales have been made through bills of sales transactions.
Completeness making sure that all Asher farms company transaction and asset, liability and equity accounts is recorded. For example, to check Asher payable accounts for understatement through selecting from record balance they must never show that the account should be greater than it …show more content…
By asking our self this question we slowly will get the answer after thinking logically. Some time the firm might not be able to carry as a going concern, or may need to pay more for poultry production or could not be able to get the supplies or selling poultry from and in important markets. That is why they need to understand the nature of Asher farm, its organization, the way they work and the industry in which they participate. This understanding allows them to value which events and transactions are expected to have a significant impact on the financial