- The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws;
- Enquiry of management around actual and potential litigation and claims;
- Enquiry of management to identify any instances of non-compliance with laws and regulations;
- We reviewed correspondence with legal and regulatory bodies where applicable;
- We agreed the financial statements disclosures to underlying supporting documentation
- We reviewed the detail of certain nominal accounts for indications of management override;
- We gained an understanding of the design and implementation of the processes and controls in place within the group which are designed to prevent, detect or correct fraud or error within the financial statements
- We challenged the accounting treatment applied in respect of revenue recognised during the year, in particular in relation to manual adjustments made to revenue, cut off between accounting periods;
- We identified and tested journal entries which we considered to be unusual and me be indicative of bias on the part of management or those charged with governance, investigating the rationale behind significant or unusual transactions.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. This risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.