EXTRACTS FROM WORKING PAPERS
Client: Hellios Computers Limited Year-end: 30 September 2019
B100
1/2
Prepared by: Miss Olsen Date: 28 February 2019
Reviewed by: Mr Peter Date: 3 March 2019
Subject: Extracts from pre-engagement checklist.
1 Question – Comment on the assessment of the reputation of the client.
Response
Except for the article in the Financial Times referred to in working paper B101 , we are
not aware of any facts or circumstances, which would “cause us to doubt the good
character of the client” .
2 Question – Comment on the assessment of the integrity of management.
Response
See above response to question 1.
3 Question – It is an overriding requirement that members of the firm should act with
objectivity and integrity when providing any professional service to a client. When
providing audit services, which require the firm to express an independent opinion,
members of the firm should also ensure that they are indeed independent. Are we aware
of any circumstances, which could be seen to compromise our independence?
Response
My independence declaration is on file.
4 Question – Determine why the company is changing auditors, and consider the effect
on the audit risk.
Response
Following disagreements between management and the previous auditors concerning
accounting issues, with respect to IAS statements, the previous auditors were not reappointed at the annual general meeting after a resolution was passed by the
shareholders, and a notice of their removal was given to the auditors concerned.
5 Question – Has the client’s previous auditors been notified of their removal and have
we communicated in writing with the previous auditors to determine whether there is any
reason professional or otherwise on why we should not accept this engagement?
Response
 We have complied with all aspects of communication with the previous auditors as
required by IFAC code of Professional Conduct.
 All required information was discussed with the previous auditors, and the previous
auditors were asked to provide any facts of which we should be aware of before
accepting the engagement.
 Our appointment was approved at a meeting of the Board of Hellios on the 10 February
2019, this was acceptable to the company’s audit committee, which also assessed our
independence
Client: Hellios Computers Limited Year-end: 30 September
2019
B100
2/2
Prepared by: Miss Olsen Date: 28 February 2019
Reviewed by: Mr Peter Date: 3 March 2019
Subject: Extracts from pre-engagement checklist.
6 Question – Is our firm providing other services besides the attest audit services? If so
provide details:
Response
 tax compliance work;
 consulting work concerning
 tax issues;
 accounting issues, including those which were subject to disputes between
management and the previous auditors;
Fees, for the above consulting services amounts to 44% of the total audit fee from
Hellios. Which is less than half of the total fees. Separate engagement letters are on file
with regards to the non-audit services provided. All non audit services were preapproved by Hellios’s audit committee.
7 Question – Before accepting an audit engagement, are we satisfied that appropriate
partners and staff will be available to perform the audit in compliance with the firm’s
procedures?
Response
 any staff available at the beginning of the audit will be assigned to the engagement.
8 Question – Have we obtained appropriate engagement letters from the client to confirm
the terms of our engagement?
Response
 All engagement letters were reviewed and found to be acceptable.