Question

Prepare an audit strategy document outlining the audit procedures which should be adopted in the verification of the stock valuation assumption of Fashion Designers and each of its retail outlets.

Answer 1

Audit procedures tor uerification f Stock valuation auumption DAome of the steck valuation aiumptions inelude going cencein Alinvestment, diuidend payout and industry auumptione ) In 0rdes to veity the going concesn asdumptien, an ascertain whither any event 0 a Iraneactionhas takin place that will poce a exiutence cueditor should ignificant threat tor the cempany which will the ultimataly put going conceun asumptan in jepndy werify disidend payout assumpliene he should chek the payoutpattans of last s to lo yeau to see the impact of such payout to valuatien of the stock f the cempany

thy induty assiumptine, an Quditorshould analyse the performa to companies hce of Variour hival find out the aumption analyasf as a whole He should fer the valuation heports containing different impliut & explicit auumptiene the sndeustry owerity maro-economio aseumption the auditos should take into account the forucasta made by vasiouu bodies like uworld Bank that are ued by dufferent analysta as their audumptions. 6)To werify hinvetment asumptim, an auditor should Look tor the prewioue yeare to suppert the assumptim helating to the forecauting of futune cash flouse say 16. 20 years cash fioud statement