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For each of the following items in the financial statements, identify five forma of third party evidence that the auditor would rely on. i. Land ii. Rent expenses iii....

      

For each of the following items in the financial statements, identify hvo.forins of third party
evidence that the auditor would rely on.
i. Land
ii. Rent expenses
iii. Motor vehicles

  

Answers


Kavungya
(i) Land:
• Lease agreements.
• Report from specialists or experts e.g. Land surveyors.
• Confirmation from registrar of lands
• Title deeds and letters of allotment.
• Local authority receipts.

(ii) Rent expense:
• Rent agreements, invoice from the landlords and revenue authority returns.
• Use of positive and negative confirmations; i.e. the landlord confirmation_
• Report from specialists or experts. e.g. valuer

(iii) Motor vehicles:
• Seller of the motor vehicle.
• Report from specialists or experts i.e. Vehicle valuer.
• Use of positive and negative confirmations i.e. Registrar of vehicles, revenue authority.
• Insurance policy of the company taken.
• Bank correspondences if they hold custody of the log book.
Kavungya answered the question on May 14, 2019 at 13:55


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