Group Audit Instructions.docx

Group Audit Instructions.docx

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GroupAuditInstructions

XXXPTE.LTD.

GroupAuditInstructions

FinancialYearended31December2012

Introduction

A1GeneralInformation

WehavebeenengagedtoperformanauditontheconsolidatedfinancialstatementsofXXXPte.Ltd.（the

“Group”）forthefinancialyearended31December2012.ThefinancialstatementsarepreparedinaccordancewithSingaporeFinancialReportingStandards（Singapore“FRS”）.

Wehavebeenadvisedthatyouhavebeenappointedasauditorsofasubsidiarycompany,XXXPte.Ltd.,whichistobeincludedintheconsolidatedfinancialstatementsoftheGroupforthefinancialyearended31December2012.

Asauditorsoftheconsolidatedfinancialstatements,wearerequiredtoensurethatthefinancialstatementsreceivedfromsubsidiarycompaniesforthepurposeofconsolidationaresuitableforinclusionintheconsolidatedfinancialstatements.Tothatend,theseinstructionsaredesignedtoinformyouofthescopeofauditwerequireyoutoperformandoutline,amongotherareas,thekeyreportingdeadlinesandauditdeliverablestobesubmittedtousforthepurposeofourauditoftheGroup.

A-2PerformingSSA

WewillbeconductingourauditoftheconsolidatedfinancialstatementsinaccordancewithSingaporeStandardsonAuditing（“SSA”）promulgatedbytheInstituteofCertifiedPublicAccountantsofSingaporeandcomplywithInternationalStandardsonAuditing（“ISA”）.WerequestthatyouperformyourauditproceduresinaccordancewithSSAandthespecificrequirementsincludedintheseinstructions.

A-3ReportingStandards

AstheconsolidatedfinancialstatementsoftheGrouparetobepreparedincompliancewithSingaporeFRS,pleaseensurethattheaccountingpoliciesappliedbythelocalentityisconsistentwithSingaporeFRS.

WhereaccountingpoliciesappliedbythelocalentitydeviatesfromSingaporeFRS,werequireimmediatenotificationgivingfulldetailsandtheeffectsonthefinancialstatementsasdisclosedinSectionC-12.

A-4Communications

Alldocumentationshouldfirstbesubmittedelectronically（viae-mailorfacsimile）wherepossible,andsubsequentlysubmittedbycourierorpost.Forinstanceswherereportsandmemorandumsprescribedintheseinstructionsarenotapplicable,thedocumentssubmittedshouldstateso.

KeyauditpersonnelfortheGroup’sstatutoryauditareasfollows:

Name

Phoneno.

E-mailaddress

EngagementAuditPartner

EngagementAuditPrincipal

EngagementAuditManager

EngagementAuditAssistant

TheprincipalcontactforqueriesinrelationtotheauditinstructionsaretheengagementAuditSupervisor/AuditAssistant.

Allsubmissionsandwrittencorrespondencesaretobeforwardedtothefollowingaddress:

Address

:

SINGAPOREASSURANCEPAC

61TRASSTREET

079000SINGAPORE

Phone

:

（65）62247526

Fax

:

（65）63231815

Youshouldinformusimmediatelyif,duringthecourseofyouraudit,itbecomesevidentthatmajorproblemsexistinaudit,taxoraccountingareaswhichmayaffectthesubsidiary’sabilitytocompletetheGroupAuditInstructionsorcauseadelayinmeetingtherequireddeadlines.

A-5LanguageofCorrespondences/Communications

Allcorrespondences,communication,memos,reportandmanagementlettersaretobewritteninEnglish.Memosshouldbebriefandpreciseandlimitedtomaterialmattersoffact.Shouldyouhavequestionsorcommentsinconnectionwiththeauditinstructions,pleasedonothesitatetocontactus.

A-6WorkingPaperReview

Wereservetherighttoreviewthecomponentauditor’sdocumentations（“workingpaperreview”）.Forsignificantsubsidiariesaworkingpaperreviewwillbearranged.Wewillinformyouthetimeschedulefortheworkingpaperreviewinduecourse.

A-7TimetableofCommunications

DescriptionofCommunication

Section

DueDates

REPORTING

AcknowledgementofEngagementInstructions

C-1

ConfirmationofIndependence

C-2

ConfirmationofQualityControl

C-3

AuditPlanningandAuditStrategy

C-4

AuditQuestionnaires

C-5

HighlightsMemorandum

C-6

ConfirmationinRelationtoFraudRiskReview

C-7

AuditClearanceReport

C-8

SummaryofAuditDifference（SAD）Format

C-9

SubsequentEventsReview

C-10

ManagementLetter

C-11

ReconciliationofMASBDifferences

C-12

SupplementaryInformationSchedules

C-13

Management’sLetterofRepresentation

C-14

FinancialStatements

C-15

PleaseadvisetheGroupauditengagementteamimmediatelyifyouanticipateanydelayincomplyingwiththeabovereportingdeadlines.

Scopeofwork

B-1Auditscope

Theoverallauditobjectiveistoexpressanopinionontheconsolidatedfinancialstatements.Ourauditor’sopinionwillbebasedonanauditperformedinaccordancewithSingaporeStandardsonAuditing（“SSA”）.

TheGrouphasdefinedfullscopeauditforitssubsidiaries.AfullscopeauditengagementisanauditperformedinaccordancewithguidelinessetforthintheSSAusingmaterialityasassignedinSectionB-2.Yourteamshouldconsidertheappropriateauditprocedurestobeperformed.

B-2Materiality

1.GroupLevelMateriality

Inthiscontext,wewouldliketoemphasizethatfortheauditoftheGroupfinancialstatementsyouwillhavetodetermineanindependentmaterialitybasedonyourrespectiveprofessionalstandardsapplicabletothestatutoryfinancialstatements.PleaselistallproposedadjustmentsidentifiedduringyourauditintheattachedSADatSectionC-9withacumulativeeffectexceedingthethreshold.

2.Threshold

ThethresholdabovewhichmisstatementscannotberegardedasclearlytrivialtotheGroupfinancialstatementsisSGDXXX.

B-3AuditoftheInternalControlSystem

Youshouldobtainasufficientunderstandingoftheclient’sinternalcontroltoplantheaudit（e.g.,conductpreliminarycontrolriskassessment）andtodeterminethenature,timingandextentofyourauditprocedures.Youarealsorequiredtoplanandperformyouraudittoobtainreasonableassuranceonwhetherthefinancialstatementsarefreeofmaterialmisstatement,whethercausedbyerrororfraud（i.e.,fraudulentfinancialreportingand/ormisappropriationofassets）.Youshouldconsiderwhetherfraudriskfactorsmaybepresentandspecificallyassesstheriskofmaterialmisstatementofthefinancialstatementsduetofraud.Suchrisksshouldbeaddressedindesigningthenature,timing,andextentofyourauditprocedures.Youshoulddocumentyourfindingsandyourassessmentoftheeffectiveness/ineffectivenessoftheclient’sinternalcontrolattheentitylevel.

B-4SpecificAuditProcedureswithintheFullAudit

Inrespectofyourauditofthelocalentity,pleaseincludethefollowingconsiderationsinyourauditplanandensurethatyouobtainsufficientappropriateauditevidenceandmaintainadequatedocumentationofyourauditapproach:

1.Auditor’sResponsibilitytoConsiderFraudinanAuditofFinancialStatements（SSA240）

∙Auditriskassessment

∙Assessmentoffraudrisk

2.Property,PlantandEquipment（FRS16andFRS36）

∙Impairmentofproperty,plantandequipment

3.TradeDebtors

∙Impairmentoftradereceivables（FRS39）

PleasestateintheattachedhighlightsmemorandumatSectionC-6whetherornotyouhaveperformedtheabovementionedauditproceduresandanyotherimportantauditissuesarisingfromyouraudit.

B-5EngagementLetter

Youarerequiredtoobtainanengagementletterwiththelocalentitythatcoverstheauditofthelocalentity’sfinancialstatements.

Reporting

C-1AcknowledgementofEngagementInstructions

Kindlyreturnthisacknowledgementuponreceiptoftheseinstructionsandconfirmwhetheryouwillbeabletomeetthereportingdeadlinesandwhetherthereareanysignificantmatterswhichyouwouldliketodrawourattentiontoatthisstage.

C-2ConfirmationofIndependence

WerequestyoutoconfirmthatyouareindependentwithrespecttotheGroup.Therefore,werequestyoutoreturnyourindependenceconfirmationtousuponreceiptoftheseinstructionsusingthefollowingformat.

C-3ConfirmationofQualityControl

Werequestyoutosendaconfirmationofyourqualitycontrolforfirmandreviewoffinancialinformation.

C-4AuditPlanningandAuditStrategy

Pleaseprovideyourauditplanningandauditstrategymemotousandtoensurethatatleasttheitemsinthefollowingarecovered.

C-5AuditQuestionnaires

Auditquestionnairesdealwiththeauditproceduresandstandardsthatyoushouldconsiderwhileperformingyouraudit.PleasefillinYES/NO/NAresponsefortherespectiveproceduresyouhaveperformedandprovidefurtherinformationaboutalternativeauditproceduresorsignificantexceptionsfound.

C-6HighlightsMemorandum

TheHighlightsMemorandum（“HM”）foryourauditthatsummarisesimportantauditresultsandconclusions,highlightingmajorissuesfromyourauditworkistobeprovidedtothekeycontactinaccordancewiththetimetableatSectionA-7.TheHMshouldreportnecessarydatawithoutover-emphasisinghistorical,financial,orauditingmattersthatcouldobscuresubstantiveissues.YourHMshouldbewritteninamannerthatfullyexplainsthefactsoftheissues,amountsinvolved,andconclusionsreached.Asalloftheseissueswillbediscussedwithcorporatemanagement,itisimportantthatallsuchmattersbediscussedwithlocalmanagementandtheirconcurrence（orotherwise）notedintheHM.

Weexpectthatthematterswouldbecoveredinthefollowingformat.

C-7ConfirmationinRelationtoFraudRiskReview

YourauditinaccordanceSSA240isrequiredtoenableustoobtainreasonableassurancethatthefinancialstatementstakenasawholearefreefrommaterialmisstatementwhethercausedbyfraud