MAASAI MARA UNIVERSITY
REGULAR UNIVERSITY EXAMINATIONS
2019/2020 ACADEMIC YEAR
FOURTH YEAR FIRST SEMESTER
SCHOOL OF BUSINESS AND ECONOMICS
THE DEGREE OF BACHELOR OF BUSINESS MANAGEMENT
COURSE CODE: BCM 4105
COURSE TITLE: AUDITING AND ASSURANCE
SERVICES
DATE: 5TH DECEMBER 2019 TIME: 11:00AM – 13:00PM
INSTRUCTIONS TO CANDIDATES
Answer all the questions in section A and ANY OTHER THREE in Section B
PART A. COMPULSORY QUESTION (25 MARKS)
QUESTION ONE
It has often been said that the Auditor report is the formal result of all his
efforts. This being the case, it is very important that the reader will
understand the meaning of the Audit Report, particularly where the auditor
wishes to qualify his opinion on the financial statements.
Required:
a) Under statutory provision, what are the main contents of the Auditor
Report?
(10 marks)
b) Explain how the international standards on auditing attempts to ensure
that the report of the auditors is clearly understood? (10 marks)
c) Describe clearly the circumstances in which an adverse opinion and a
disclaimer of the opinion would be appropriate and give two examples,
one each to illustrate your answer. (5 marks)
PART B: ATTEMPT ANY 3 QUESTIONS.
QUESTION TWO
a) What is the purpose of a Letter of Representation? (5 marks)
b) State and explain the action auditors should take is the management
refuses to provide a Letter of Representation. (4 marks)
c) State the specific representation you as an auditor, would wish to obtain
from management in respect of:
i. Assets (3 marks)
ii. Liabilities (3 marks)
QUESTION THREE
b) Explain in details each of the Professional’s Ethics required of an Auditor
(8 marks)
c) Explain in details the qualities of an auditor (7 marks)
QUESTION FOUR
With reference to Regulatory environment for auditors in Kenya describe the
following:
a) Functions of Kenya Accountant and Secretarial National Examination
Board (KASNEB) (8 marks)
b) Duties of the Certified Public Accountant of Kenya (ICPAK) (7 marks)
QUESTION FIVE
The Companies Act 2015 includes provisions regarding the appointment,
duties and powers of a company’s auditor.
a) State the ways in which an auditor can be appointed (5 marks)
b) Detail the statutory duties imposed on an auditor (5 marks)
c) Explain the purpose of an Engagement letter and list its contents
(5 marks)
