(b) Completion issues and laws and regulations
Generally up to 1½ marks for each point discussed:
– Storage of hazardous chemicals likely to be a breach of laws and regulations
– Auditor needs to understand laws and regulations applicable to the Group
– Further evidence should be obtained about the storage of chemicals
– Implications for the financial statements to be considered, e.g. provisions for fines and penalties
– Matter to be reported as soon as possible to those charged with governance
– Auditor may have a legal duty to disclose, or consider disclosing in the public interest
– Intimidation and threatening behaviour should be reported to those charged with governance
– Control deficiency and recommendation to be communicated to those charged with governance
– The audit firm may wish to seek legal advice regarding the situation
Maximum marks 9