Auditing and Assurance (ACC3AUD)
Semester 1, 2017
Department of Accounting
La Trobe University
This assignment is to be based on Bega Cheese (ASX code-BGA).
The assignment is to be completed in groups of 3 (members need not be in the same workshop).
Students are expected to demonstrate their ability to critically evaluate information relating to Bega Cheese and apply analytical skills to identify potential audit risks. This will require extensive research on Bega Cheese’s operations, strategies, critical analysis of the annual report and any other information that you have obtained.
This assignment represents 20% of the total assessment of the subject.
All assignment answers will be checked for plagiarism using Turnitin.
1. The assignment must be submitted via LMS through Turnitin, as per the Subject Learning Guide.
2. The due date for assignment is Thursday April 27, 2017 5.00 pm. Any assignment received after this time will be considered late and subject to the penalty described in the Subject Learning Guide (pp. 7-8).
Length and format
The assignment shall be presented in the below format:
3. A title page containing the title of the assignment, name and student numbers of the group members, workshop facilitator’s name and the time and location of the workshop.
4. A table of contents
5. An executive summary
6. The build of the assignment (MS word, maximum 3,000 words (10% plus or under is acceptable e.g. 2700-3300), Times New Roman, size 12 font, double spacing). Appropriate reference citations throughout the assignment are expected. Each page must be numbered.
Failure to meet the above length and format requirements will incur an eight (8) mark penalty.
1. You are part of the audit team responsible for planning the Bega Cheese (parent and the consolidated economic entity) audit engagement for 2017. You and your colleagues have been assigned to gather relevant background information and prepare a report for a meeting with your senior audit managers and partner. In the report you must address the following issues:
a. What are the areas in which Bega Cheese conducts its operations?
b. Which particular laws/regulations (other than financial related categories which include legislations such as: Corporation Act 2001, Australian taxation laws, etc.) affect its operations? You need to list SIX laws/regulations.
2. Identify FIVE inherent risks for the audit of Bega Cheese. For each inherent risk, identify the account or accounts that may be affected.
3. With specific reference to Bega Cheese’s corporate governance arrangements, you need to assess the likelihood of the potential reliance that could be placed on the overall control environment. Your conclusion should be supported by at least FIVE factors.
4. Recently Bega Cheese acquired the Vegemite and other Kraft brands in a $460 million deal that takes it far from its roots as a cheese producer. How will this acquisition affect your 2017 audit plan for Bega Cheese? Your answer should be supported by at least FIVE factors.
[10 marks] 5. In early 2016, Bega Cheese and Blackmores set up their joint venture- called Bemore- to supply infant formula and other nutritional foods to consumers in Australia and Asia (mainly China). However, due to regulatory change in China and intense competition the joint venture did not go as well as initially hoped. As a result, there was a dramatic fall in the share price of Bega Cheese. How will this fall affect your 2017 audit plan for Bega Cheese? Your answer should be supported by at least FIVE factors.
Grand total/ 40 - Final marks/20 -