Imaginary Services Co Pty

question 33

Essay

Imaginary Services Co Pty. Ltd started trading last year, and has undergone a recent surge of growth due to increased demand for their Imaginary Service. Your firm was appointed auditor for Imaginary Services Co Pty. Ltd in August 2010. As a result of this timing, you did not get the opportunity to observe the physical inventory count as of 30 June 2010 as it was done prior to your appointment. Owing to the nature of the company's records, you have not been able to satisfy yourself as to inventory quantities.
The inventory balance is material, however, you have found that controls over inventory are good, and that there is a low risk of misstatement for this asset. What type of audit report would you issue, and why?
If the company was Imaginary Consumables Co Pty Ltd, and the controls over inventory were not so good, would this affect the audit report, and why?

Grasp different problem-solving styles and how they relate to team dynamics.

Acknowledge the importance of organizational citizenship behavior (OCB) and its impact on team and organizational success.

Learn the factors leading to groupthink and strategies to avoid it.

Realize the importance and criteria for forming effective teams.

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Definitions:

Sales Contract

A legally binding agreement between a buyer and a seller regarding the sale of goods or services.

Cupcakes

Small, individual-sized cakes baked in a cup-shaped mold, often decorated with frosting and other toppings.

Manufacturer's Warranty

A promise by a manufacturer to repair or replace defective products within a certain period of time after purchase.

Microwave Oven

An electric oven that uses microwaves to heat or cook food by causing water molecules in the food to vibrate and produce heat.