Sime Darby Berhad Case Analysis

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Based on the Statement of Profit or Loss of Sime Darby Berhad of the group, we have chosen the sale of goods, which is from the revenue. The revenue for the group represents sale of goods, performance of services, income from property development activities, construction contracts and rental income earned outside the group, net of discounts, allowances and liquidated ascertained damages. From the sale of goods, the group can earn revenue. According to Sime Darby’s Statement of Profit or Loss for the year ended 30 June 2015, the Group had earned RM37096.80 from the sale of goods. Auditors should execute management assertions in order to make sure that there is a true and fair view in the financial statement. Management assertions are assertions by management which is responsible for the …show more content…

External confirmation means that auditors can get audit evidence as a direct written response to the auditor from a third party, in electronic medium, paper form or other medium. Auditors can seek confirmation about details in the accounting records of the organization from external sources. There are four factors to verify the external confirmation’s reliability which are written or oral confirmation, the nature of the information being confirmed, past experience with the organization and the party or person who is giving the confirmation. In Sime Darby Berhad, auditor can ask the third party directly about the details in the accounting records in order to make sure that all transactions recorded in the financial statement are correct and are actually occurred. For example, auditor can collect receivable confirmation on their balances to ensure that the amount of sale of goods which is RM37096.80 are recorded appropriately and are actually happened in the business. The level of reliability of external confirmation reach at the medium

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