Business College

Identify the type of audit report for each company and explain why report was issued by the auditor. Provide ONE point in each case. NOTE: Refer to two reports to answer this question. How does a disclaimer report affect a company? ORMATION: Pills Ltd. (4) (1) In our opinion, the financial statements fairly present, in all material respects, the financial position of Pills Ltd on 31 December 2022 and the results of their operations and cash flows for the year ended, in accordance with International Financial Reporting Standards (IFRS), and in the manner required by the Companies Act in South Africa. Portions Ltd. In our opinion, except for the effects of the company's overvaluation of its fixed assets, the financial statements fairly present the financial position of Portions Ltd. on 31 December 2022 and the results of their operations and cash flows for the year ended, in accordance with International Financial Reporting Standards (IFRS), and in the manner required by the Companies Act in South Africa. TOTAL MARKS:​

Answers

Answer 1

Type of audit report for each company and its reason for issuance: Auditors are responsible for evaluating a company's financial statements to ensure that they are accurate, truthful, and adhere to accounting standards. They give an audit report based on their audit, which can be classified into different types.

The Pills Ltd and Portions Ltd audit reports are analyzed below: Pills Ltd audit report: The Pills Ltd auditor has given an unqualified audit report. The audit report was issued because the auditor was able to obtain enough convincing evidence about the financial statements' accuracy and reliability.

The company's financial statements represent the organization's financial condition as of 31 December 2022, as well as its cash flow and operations for the year ended. The audit report issued by the auditor is a positive signal to the company that its financial statements are accurate and complete, which will increase the company's reputation and market value.

Portions Ltd audit report: The Portions Ltd auditor has given a qualified audit report. The auditor issued a qualified report because of the company's overvaluation of its fixed assets. Even though the company's financial statements are accurate and represent the company's financial position, the auditor still issued a qualified report.

This is because the auditor discovered an issue with the financial statement's accuracy, and even if it is a minor one, the auditor must disclose it. A qualified report is a warning that something in the financial statements is inaccurate, which might influence the company's reputation and market value.

Overall, an unqualified audit report is a sign that a company's financial statements are correct, whereas a qualified audit report signifies that something in the financial statements is inaccurate or misleading. The audit report has a significant influence on a company's reputation and market value.

Additionally, it is advised to have an unqualified audit report to demonstrate that the financial statements are accurate. Disclaimer report effect on a company: A disclaimer of opinion is a kind of audit report in which the auditor cannot express an opinion due to insufficient or unclear financial statements information.

A disclaimer report is a signal that the auditor has been unable to obtain enough evidence to support their opinion. As a result, a disclaimer of opinion may cause investors and other stakeholders to lose faith in the company's financial statements, reducing the company's credibility.

Additionally, it may reduce a company's reputation and market value because investors may assume that something is wrong with the company's financial statements. Therefore, it is strongly suggested to avoid a disclaimer of opinion as much as possible to avoid negative impacts on the company's reputation and market value.

For more questions on: financial statements

https://brainly.com/question/14615122

#SPJ8  

Related Questions

Other Questions
What do we call a circular earthwork delineated by a ditch and embankments, and often ariticulated with a circle of stones or posts? Andrea Apple opened Apple Photography on January 1 of the current year. During January, the following transactions occurred and we 1. Andrea invested $15.300 cash in the business. 2. Andrea contributed $38,000 of photography equipment to the business. 3. The company paid $3,900 cash for office furniture. 4. The company received $7.500 cash for services provided during January. 5. The company purchased $8,000 of office equipment on credit. 6. The company provided $4.550 of services to customers on account. 7. The company paid cash of $3,300 for monthly rent. 8. The company paid $4,900 on the office equipinent purchased in transaction $5 above. 9. Paid $455 cash for January utilities. Based on this information, the amount reported as Owner Capital on the balance sheet at month-end would be: Multiple Choice $56,600 $60,800 $52750 $61595 Today you are writing a Narrative, a short story (2 to 3 pages)! You can write in ANY genre; mystery romance, science fiction, children's story, horror, any kind you like. This is not a personal narrative; it is entirely fictional and genre-based. There are two things to be aware of: or 1. You should include dialogue. Instead of saying: Anita said she was going to the store. You'd write: "I'm going to the store right now!" Anita declared. See how that sounds better? 2. Stories work well if they follow a basic pattern: A. First we meet all or most of the character. B. There's an Inciting Incident that sets off the plot, for example, Anita's skateboard is stolen C. Rising action: the kids try to find out who stole the skateboard. D. The climax: Anita finds the thief and gets her skateboard back, E. Conclusion. The kids go home The speech should be uploaded to Canvas before midnight on the date shown in the title above What do you consider to be the most important of the Sustainable Development Goals (SDGs) and why? How is the progress on this goal so far? Discuss. The primary difference between IAS 37, and U.S. GAAP concerning the treatment of contingent liabilities pertains to: definition of terms. discuss MIS as a technology based solution must address all the requirements across anystructure of the organization. This means particularly there are information to beshared along the organization David would like to organize HOS (a business entity) as either an S corporation or as a corporation (taxed as a C corporation) generating a 12 percent annual before-tax return on a $420,000 investment. Davids marginal tax rate is 24 percent and the corporate tax rate is 21 percent. Davids marginal tax rate on individual capital gains and dividends is 15 percent. HOS will pay out its after-tax earnings every year to either its members or its shareholders. If HOS is taxed as an S corporation, Davids business income allocation would be subject to a 3.8 percent net investment income tax (he is a passive investor in the business) and the business income allocation would qualify for the deduction for qualified business income. (Round your intermediate calculations and final answer to whole number dollar amount.) a. How much would David keep after taxes if HOS is organized as either an S corporation or a C corporation? b. What are the overall tax rates (combined owner and entity level) if HOS is organized as either an S corporation or a C corporation? Regarding the question above, choose the affected shift factor. Technology The price of a related good (production) The number of sellers The price of a related good (consumption) Tastes Input price Expectations Income The number of consumers Question 15 (1 point) United Auto Workers of America, the largest union of auto workers, demand and receive higher wages for auto workers. Which of the below will be affected in the market for cars, (Choose the most appropriate answer) Supply Only the quantity demanded Only the quantity supplied Demand Question 16 (1 point) Regarding the question above, describe the new equilibrium relative to the old equilibrium. (Graph First) Price increases and the quantity increases. Price decreases and the quantity decreases. Price increases and the quantity decreases. Price decreases and the quantity increases. Question 17 (1 point) Regarding the question above, choose the affected shift factor. Regarding the question above, choose the affected shift factor. Income Expectations Technology Input price The number of consumers The price of a related good (consumption) The number of sellers The price of a related good (production) Tastes Question 18 (1 point) A discovery reduces the cost of producing sport utility vehicles without altering the amount of labor or capital. Which of the below will be affected? (Choose the most appropriate) Demand Only the quantity demanded Only the quantity supplied Supply Question 19 (1 point) Regarding the question above, describe the new equilibrium relative to the old equilibrium. (Graph First) Price decreases and the quantity increases. Price increases and the quantity decreases. Price decreases and the quantity decreases. Price increases and the quantity increases. The cerebral cortex is organized in six layers of cell bodies called ________ , which are parallel to the surface of the cortex. AB Ltd.'s retained earnings increased by $186 during the year. Also during the year dividends of $2,380 were declared and paid to shareholders. AB's net income for the year must have been: $ deciphering the urinary microbiota repertoire by culturomics reveals mostly anaerobic bacteria from the gut Zed and Adrian run a small bicycle shop called "Z to A Bicycles". They must order bicycles for the coming season. Orders for the bicycles must be placed in quantities of twenty (20). The cost per bicycle is R1700 if they order 20,R1650 if they order 40,R1550 if they order 60 , and R1340 if they order 80 . The bicycles will be sold for R5000 each. Any bicycles left over at the end of the season can be sold (for certain) at R1450 each. If Zed and Adrian run out of bicycles during the season, then they will suffer a loss of "goodwill" among their customers. They estimate this goodwill loss to be R500 per customer who was unable to buy a bicycle. Zed and Adrian estimate that the demand for bicycles this season will be 10,30,50, or 70 bicycles with probabilities of 0.2,0.4,0.3, and 0.1 respectively. Set-up the cost payoff matrix for this problem. It takes a barber 10 minutes to serve one customer. Round your answers to two decimal places. What is the capacity of the barber expressed in customers per a. hour? 6.00 customers per hour Asming the demand for the barber is 2 customers per hour, what is the flow rate? b. 2.00 customers per hour Assuming the demand for the barber is 2 customers per hour, what is the utilization? 50.00 percent Assuming the demand for the barber is 2 customers per hour, what is the cycle time? d. 18.00 minutes per customer What process describes the removal of portions of mrna after transcription to produce mrna consisting of regions to be translated? Conduct a survey and collect the following information from 50 individualson Environmental issues. Do you think if these are the valid issues for Environmental Degradation?Mark your answers as agree or disagree.S.No. Environmental Issues Agree Disagree1 Depletion in water2 Soil Degradation3 Biodiversity4 Construction of Wells5 Afforestation6 Chemical Fertilizers Represent the above information an a double bar graph. Discuss and illustrate the meaning, definition and characteristics of management in modern organizations. I need help on this fast Find the inverse of each function. Is the inverse a function? f(x)=5x / 9 Let's assume that a boctor's equilibrium price of a physical examination ("physical") is 5250 , and the govemnent imposes a price ceiling of $200 per pirysical. As a result of the price ceiling, the supply curve foc playsicals shifts to the left. quantity denunded of plysicals increases, and the quantity supplied of physicals decreases. number of phyncals periormed stays the same. demand curve for physicals shifts to the right. What are the four adult roles for facilitating the play of infants and toddlers?