(b) Audit procedures on segmental reporting

Up to 1 mark for each relevant audit procedure. Examples are provided below and marks will be awarded for other relevant points.
 – Review the financial reports sent to the highest level of management to confirm the basis of segmental information which is reported internally
 – Review the Group’s organisational structure to confirm identify of the chief operating decision maker
 – Discuss with management the means by which segmental information is reviewed by the chief operating decision maker
 – Review board minutes to see that segmental information is subject to regular review
 – Discuss with management whether the on-board sales should be reported separately
 – Obtain a breakdown of the revenue to confirm that revenue has been appropriately allocated between the reportable segments
 – Perform analytical procedures to determine trends for each segment and discuss unusual patterns with management
 – Recalculate the revenue totals from the breakdown provided to confirm that they are reportable segments

Maximum marks 5