AUDITING 3A- TEST 2 UNIVERSITY OF ZULULAND University of Zululand, Private Bag X1001, KwaDlangezwa, 3886 W: www.unizulu.ac.za FACULTY OF COMMERCE, ADMINISTRATION & LAW DEPARTMENT OF ACCOUNTING AND AUDITING 2AUD301 & 2AUT301- Auditing 3A TEST 2 -7 June 2021 DURATION - READING AND WRITING: 75 MINUTES FULL MARKS: 50 Internal Examiner: Mr INT Mthembu CA (SA) Internal Moderator: Mr CJ van Heerden CA (SA) INSTRUCTIONS TO STUDENTS: 1. This paper consists of TWO questions (set out on pages 2 to 5) excluding this cover page. Ensure that your paper is complete. 2. Where more than one answer book has been used, clearly identify the sections answered on the top of each page. 3. Fill in all the details your details to ensure that the script clearly depicts your identity. 4. Use only blue or black ink. Do not write in pencil; pencil-written work will not be marked. 5. Typed SCRIPT will not be marked. 6. Work NEATLY and LOGICALLY. Marks will be awarded for pervasive skills (communication, language, writing style, clarity of expression, presentation, logical and well-constructed answers,). 7. In answering the questions, record any assumptions you may consider necessary. No questions will be answered by invigilators during the exam. 8. Clearly separate the different sections of your answer and where applicable start every new (required) question on a new page of your answer book. 9. Read the REQUIRED section properly, more than once and again while answering the question to ensure you provide a direct adequate response. 10. By writing this online-based assessment you agree to the University rules against plagiarism and any other form of dishonesty. 1 | Page
AUDITING 3A- TEST 2 [28 Marks] Question 1 You have been appointed on to a panel of investigators to evaluate the cases of improper conduct of Chartered Accountants. You have been presented with the following independent cases: Case 1 (10 Marks) Nonjabulo Sam CA (SA) was employed by a large firm of auditors, Dilute and Young Inc., for a number of years. Her dedication to computer auditing had earned her a reputation as a highly proficient and hard-working member of the computer audit division within the firm. She was therefore, surprised when she was overlooked for the fourth time for appointment as a partner, and her male colleague was, instead, promoted. She was quoted as saying she does not see herself becoming a partner at Dilute and Young Inc. She resigned and cleared up all outstanding issues with her clients. Shortly thereafter, one Dilute and Young's clients, Day Time Ltd, for who Nonjabulo Sam had carried out various assignments, offered her a lucrative engagement to review their computerised accounting systems. To comply with her professional obligations, Nonjabulo informed Dilute and Young of the approach, having notified Day Time Ltd of her obligations to do so. Without informing Nonjabulo, Mike Dilute CA (SA), one of the senior partners at Dilute and Young, phoned the financial director of Day Time Ltd and informed him that: 1.1 Nonjabulo Sam had been dismissed from