Auditing Essay Example | Topics and Well Written Essays - 500 words - 4

Auditing - Essay Example Adverse views are those that auditors believe to bear misleading information and are therefore unreliable. Those that lack sufficient evidence to enable judgement are the disclaimers. The Hawke’s Bay Cultural Trust is one of the firms that received a non-standard audit opinion on the year beginning on April 1st 2004 and ending on March 31st 2005. It got a full adverse opinion on 30th June 2004. The purpose of receiving this stance is the trust failed to recognize the whole value of its compendium of assets. It also had no idea of the concomitant expense in depreciation in its financial records. These misdoings go against the third standard of financial reporting i.e. accounting for plant, equipment and property. It expects business entities to recognize the asset collections not achieved before to be recognized at reasonable value without forgetting to depreciate it (Audit Guidance Statement 14). The Trust is a corporation that specializes in the management of all issues concerning heritage, culture and arts on an assimilated region. Its role is to provide services in the fields of heritage, culture as well as art and related programs to those residing in Hawkes’s Bay. It also provides education and information to the Hastings District community in its areas of specialty among other roles Attached is a copy of the audit report to the readers of the Hasting’s community for the year that ended on thirtieth June two thousand and four. The company received a disclaimer because the liquidity levels were much higher than expected, resulting from an increase in surplus coupled with the degree of labor brought forward to the year 2004/05. Secondly, the present portion of term indebtedness of two million U. S dollars exceeded the long-term financial strategy budget. There were capsizing finances as a consequence of the decision to utilize internal borrowing to avoid the creation of more sinking funds (Audit Guidance Statement