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ANALYTICAL REVIEW OF FINANCIAL STATEMENT AND IDE

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CONCERN
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JB Hi-Fi is the leading brand of consumer electronics and technologies. The analytical review is perfor
of the organization faithfully represent the true and fair view of their financial position and perfor
understanding the key areas of concern that need the assistance of the auditing procedures. The ana
includes the review on the operations and financial performance with the help of which the key are
company, it is observed that the operating and financial review underlying results exclude the imple
around $22.4 million which was associated with the Good guy business association in the year 201
goodwill for the business of JB Hi-Fi in New Zealand that costs around $15.8 million (Richards & Mu
presented in this financial statement are statutory and underlying results. Total sales of the company w
compared to the year 2017 when the sales were $5,628 million only. The company compared these
statutory results for the year 2018. This area has a great impact on the overall financial statemen
statement also showed that the underlying net profit after tax grew by 12.3% to $233 million and e
million.

After the acquisition of Good Guys, it is identified that goodwill of the company was included in the co
also assessed the cash-generating units of Good Guy company through the application of value in use
on the key assumptions like the future growth rate of the business and discount rates, working capi
Good Guys acquisition and its goodwill was very difficult and need an attention of the management
zendesk chat
separately allocate the purchase consideration to intangible assets (Audit IT, 2018).

The profit and loss and balance sheet accounts of the company are highly affected because of the acqu
transaction fees and implementation costs from the underlying results of the company. The calculation
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5/13/24, 2:14 PM Analysis of auditing efficiency of JB Hi-Fi - Assignment Work Help

FORMULATION OF AUDIT PROCEDURE FOR THE IDENTIFIE

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The areas that identified in the above part are in relation to the complex transactions in relation to
some elements from the financial reporting always affects the overall financial performance of the co
in handling these key matters as it is their responsibility to review the financial reports, analyze t
performance. The procedure that formulated for the audit in response to the above areas of concern is

The auditors need to perform tests on the fair value of assets and liabilities and assess the actual am
acquisition and then include in the financial reports (Colbert, 1994).

The assistance from the taxation specialists can be encouraged to assess the allocated cost associate


the opening deferred tax balances.

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Auditors need to test the goodwill calculations associated with the acquisition transactions.
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The assessment of the goodwill in relation to the cash generating units also needs to perform as it w

Therefore, auditors are responsible for reviewing and monitoring the internal process and all the trT
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accounting reports. The auditors basically need to evaluate and ensure that all the statements are fr
comply with the Australian auditing standards. The risks of fraud, error and material misstatement are
auditors and professionals regarding the overcoming of these risks. The auditing committee can re
effectiveness of the business internal processes. The committee is also responsible for reviewing the
with the set standards, rules and business practices (Appelbaum & Vasarhelyi, 2018).

CORPORATE GOVERNANCE
According to corporate governance statement of JB Hi-Fi Company, the directors and managers are c
accordance with the high standards of corporate governance. The information in relation to corpora
conduct and corporate governance statements. The corporate statement of JB Hi-Fi company shows t
3
rd
edition of the ASX corporate governance council principles and also in the year 2018, the company’s
procedure of the corporate governance starts with acknowledging the needs for directors, executi
adopted for corporate behaviour. The acquisition of the Good Guy business by the group also represe
conduct and there is no single code applied for JB Hi-Fi (JB Hi-Fi Limited, 2017).

AUDITING COMMITTEE JB HI-FI AND ITS COMPOSITION

The company has the auditing and risk management committee that comprised of five members. Acco
of the
that the audit committee should have at least 3 or more independent directors and one chair
committee of JB Hi-Fi comprised of three independent or non-executive directors and one chair of the
the composition of the company is right as it includes Beth Laughton (Chair of the committee), Wa
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5/13/24, 2:14 PM Analysis of auditing efficiency of JB Hi-Fi - Assignment Work Help

members of JB Hi-Fi also has great experience and education in the field of finance. The chair of th
appropriate education in finance. This composition of the audit committee has the responsibilities t
(https://www.assignmentworkhelp.com/) ABOUT US SERVICES   SUBJECTS  SAM
manage the financial risks. This committee of auditing and risk management also provides some of the
reports. The committee reviews the performance of the auditors and monitors the effectiveness of
responsible for reviewing the compliance of business activities and financial reporting with the set sta
2012).

BENEFITS OF THE AUDITING COMMITTEE

In my opinion, the auditing committee provides great benefits for the auditors, company, society an
beneficial in obtaining reasonable assurance about whether the company and its financial reporting ha

The main purpose of the auditing committee is to ensure that all the statements are free from the mat
Australian auditing standards. The risks of fraud, error and material misstatement are basically anal
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professionals regarding the overcoming of these risks. The committee also held responsible forun

auditing. The auditing committee also provides the benefit of evaluating the appropriateness of accoun
by directors. With the evidence obtained by the audit committee, the company can apply the going( H
con
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the company. The auditing committee also evaluates the overall presentation, structure and standard
great advantage as it provides great assistance to directors of the company regarding the key audit
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effectiveness of the accounting statements. The committee also assesses changes in accounting policie
of the company.

Therefore, from the above analysis of the financial reports of JB Hi-Fi, it is clear that the auditing is pl
the organization in review and monitors the financial performance. The analytical review of company’
complex transaction because of the acquisition of Good Guys business and hence, the formulation o
company, directors, professionals and society as a whole (Murray, 2013).

REFERENCES
Appelbaum, D., & Vasarhelyi, M. (2018). Analytical procedures in external auditing: A comprehens
analytics.
Journal of Accounting Literature, 40
, 83-101. Retrieved from https://www.sciencedirect.com/science/article/pii/S0737460716300611

Audit IT. (2018). Cash Flows from Financin

https://www.readyratios.com/reference/accounting/cash_flows_from_financing_activities.html

Colbert, J. (1994). Analytical Procedures for Management Accountants and Auditors.

Managerial Auditing Journal, 9 (5), 3-7. Retrieved from https://www.emeraldinsight.com/doi/abs/10.1

Francis, J., & Khurana, I. (2012). The role of accounting and auditing in corporate governance and the de
Asia-Pacific Journal of Accounting & Economics, 10(1), 1-30. Retrieved from https://www.tandfonline.

JB Hi-Fi Limited. (2017).


JB Hi-Fi Limited: Half-year financial report.
Retrieved from http://member.afraccess.com/media?id=CMN://3A487513&filename=20180212/JBH
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5/13/24, 2:14 PM Analysis of auditing efficiency of JB Hi-Fi - Assignment Work Help

Murray, R. (2013).
Annual Report 2017: JB Hi-Fi.
(https://www.assignmentworkhelp.com/) ABOUT US SERVICES   SUBJECTS  SAM
Retrieved from https://www.jbhifi.com.au/Documents/2017%20Annual%20Report.pdf

Richards, G., & Murray, R. (2018).

ANNUAL REPORT: JB HI-FI. Retrieved from https://investors.jbhifi.com.au/wp-content/upload
Report.pdf

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