SEMESTER FALL 2019
FUNDAMENTALS OF AUDITING (ACC311)
DUE DATE: 27TH NOVEMBER, 2019 MARKS: 10
The students are expected to develop an understanding on auditor’s appointment and qualification in light of Companies Act 2017.
After going through this activity, the students will be able to understand how an individual or company can be appointed as an auditor.
Following are some independent scenarios with reference to appointment & qualification of an auditor:
Barkat Enterprises (a public limited company) dissatisfied with the performance of their current auditors decided remove them. In the recent AGM of the enterprise, one of its directors, Waseem proposed his own chartered accountancy firm, running under his name as M/S Shafee & Co. as the new auditors for the enterprise. The board has approved this proposal and appointed M/S Shafee & Co as their new external auditor.
MTM, a renowned yarn manufacturing firm has recently transformed its legal status into a private limited company with paid up capital of Rs. 3.20M. After the registration, it hired a chartered accountancy firm, Nabi Associates as external auditor for the audit purpose.
Ahsan after completing his CA qualification started his own audit firm with his class mate Asghar 5 years ago. Asghar’s wife, Sara is working as a director at Ahmar & Sons (a private limited company) and holds 35% shares in it. Recently, she used her influence in the company’s board meeting to appoint her husband’s firm as the company’s external auditor.
Since the first day of December 2017, Shahbaz is running his own audit firm providing service in all walks of business including audit. On October 01, 2019 he was offered an opportunity to work as an external auditor of a limited company. He is happy for this offer as he had spent some good time of 2 years in that company as its finance manager before starting his own audit firm.
Zeeshan has been working as an employee at Hussain Limited for the last 2 years. Before this joining, he was working as an audit trainee with an audit firm registered with the ICAP. Now, he has passed all the examinations of his chartered accountancy qualification and is planning to start his own audit firm. On knowing this, his employer, Hussain Limited has offered him to work as the company’s external auditor.
Read carefully provisions of the Section 254 of the Companies Act 2017. Give your opinion, in light of the said section, on the appointments of individuals in the above scenarios as an external auditor.
24 hours extra/grace period after the due date is usually available to overcome uploading difficulties. This extra time should only be used to meet the emergencies and above mentioned due dates should always be treated as final to avoid any inconvenience.
IMPORTANT INSTRUCTIONS/ SOLUTION GUIDELINES/ SPECIAL INSTRUCTIONS
BE NEAT IN YOUR PRESENTATION
OTHER IMPORTANT INSTRUCTIONS: DEADLINE:
Make sure to upload the solution file before the due date on VULMS.
Any submission made via email after the due date will not be accepted. FORMATTING GUIDELINES:
Use the font style “Times New Roman” or “Arial” and font size “12”.
It is advised to compose your document in MS-Word format.
You may also compose your assignment in Open Office format.
Use black and blue font colors only.
Use APA style for referencing and citation. For guidance search “APA reference style” in Google and read various websites containing information for better understanding or visit http://linguistics.byu.edu/faculty/henrichsenl/apa/APA01.html
RULES FOR MARKING
Please note that your assignment will not be graded or graded as Zero (0), if:
It is submitted after the due date.
The file you uploaded does not open or is corrupt.
It is in any format other than MS-Word or Open Office; e.g. Excel, PowerPoint, PDF etc.
It is cheated or copied from other students, internet, books, journals etc. Note related to load shedding: Please be proactive
As you know that Pre Mid-Term semester activities have been started and load shedding problem is also prevailing in our country. Keeping in view the fact, you all are advised to post your activities as early as possible without waiting for the due date. For your convenience; activity schedule has already been uploaded on VULMS for the current semester, therefore no excuse will be entertained after due date of assignments or GDBs.