You are auditing the financial statements of Newbridge Trading plc, for the
year-ended 31 October 1997.
The senior partner of your audit firm has asked you to consider the
auditor‟s responsibilities for identifying subsequent events. Also, he has
asked you to describe the audit procedures, which examine subsequent
events. He has suggested that an example of one point in answer to part
(b) below would be:
„Checking sales ledger cash received after the year-end to determine the
realisability of debtors at the year-end and highlight doubtful debts.‟

The detailed audit work was completed on Friday 5 December 1997. It is
proposed that:
a) The audit report will be signed on Friday 19 December;
b) The financial statements will be sent to shareholders on Monday 5
January 1998; and
c) The company‟s annual general meeting will be held on Wednesday 28
January 1998.
Required:
a) Consider the auditor‟s responsibilities for detecting material subsequent
events in the periods:
i) 31 October to 5 December 1997
ii) 5 December to 19 December 1997
iii) 19 December 1997 to 5 January 1998
iv) 5 January 1998 to 28 January 1998
v) After 28 January 1998 (7
marks)
b) List and briefly explain audit procedures, which involve examination of
subsequent events.
(10 marks)
c) Describe the audit work you will carry out in period (a) (ii) above.
(3 marks)