Towards the end of an audit, it is common for the external auditor to seek a letter of representation (written representations) from the management of the client company. Required: List the matters commonly included in the letter of representation – Business and Technical Learning Resources

Common categories of matters included in the letter of representation
Confirmation of responsibility for, and approval of, the financial statements.
Confirmation that all of the accounting records, and all related documentation (such as minutes of management and shareholder meetings) have been made available, and that company transactions have been properly reflected therein.
Confirmation of the expected outcome of legal claims.
Confirmation of company plans in relation to certain tax provisions.
Confirmation of the completeness of disclosure of related party transactions.
Confirmation that there have been no post-balance sheet events that require revisions to the financial statements

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Identify any four contents of an audit engagement letter
During the final stage of the first audit of Nairobi National Bank Ltd. You request the client to provide you with a letter of representation. The Client reads representations you are requesting and refuses to furnish the letter. The client states its position to be as follows:―You are asking us to tell you all manner of things which we appointed you to find out. You are requesting us to say such things as ‗all the transactions undertaken by the bank have been properly reflected in the accounting records‘and yet we pay you to carry out the audit. You should know whether these statements are true or not .Required: Explain to the client the purpose of the letter of representation
During the final stage of the first audit of Nairobi National Bank Ltd. You request the client to provide you with a letter of representation. The Client reads representations you are requesting and refuses to furnish the letter. The client states its position to be as follows:―You are asking us to tell you all manner of things which we appointed you to find out. You are requesting us to say such things as ‗all the transactions undertaken by the bank have been properly reflected in the accounting records‘and yet we pay you to carry out the audit. You should know whether these statements are true or not. Required: Explain the consequences of your client‘s refusal to furnish a letter of representation
Meaning of Common law
Explain the advantages of a private company over a public company
During the final stage of the first audit of Nairobi National Bank Ltd. You request the client to provide you with a letter of representation. The Client reads representations you are requesting and refuses to furnish the letter. The client states its position to be as follows:-―You are asking us to tell you all manner of things which we appointed you to find out. You are requesting us to say such things as ‗all the transactions undertaken by the bank have been properly reflected in the accounting records ‘and yet we pay you to carry out the audit. You should know whether these statements are true or not; required: Explain the reliability of a letter of representation as audit evidence and the extent to which the auditors could rely on this evidence
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You have been the auditor of Crossborder Trading Company Ltd. for a number of years. The company‘s head office is in Nairobi, Kenya and if has considerable overseas operations. At each accounting year end, there are large debts due from overseas agents of the company (Sh. 270 million out of total debts of Sh. 680 million as at 31 December 2000). In the past, these debts have always been settled after year end but you have insisted that the debts be the subject of a specific representation made by the company‘s director. Required: State what action you would take if the directors refused to provide you with a letter of representation
You have been the auditor of Crossborder Trading Company Ltd. for a number of years. The company‘s head office is in Nairobi, Kenya and if has considerable overseas operations. At each accounting year end, there are large debts due from overseas agents of the company (Sh. 270 million out of total debts of Sh. 680 million as at 31 December 2000). In the past, these debts have always been settled after year end but you have insisted that the debts be the subject of a specific representation made by the company‘s director. Required: State what action you would take if the directors refused to provide you with a letter of representation
Matters that a marine insurance policy must specify
Explain three characteristics of a private limited company
State and briefly explain the action auditors should take if the management refuses to provide a letter of representation
Matters in which African Customary Law can be applied
Explain the importance of audit to a limited liability company
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Highlight the qualities required of the final accounts prepared by a client company
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Explain the procedure a company has to follow when changing its auditors. In your discussion explain ‗dismissal‘ and ‗appointment‘ of auditors by a company?
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What is the purpose of a letter of representation?
You have been appointed the auditor of United Millers Company Limited, a medium manufacturing company which is quoted on the stock exchange. Required: List the important matters which must be included in the letter of engagement.
Towards the end of an audit, it is common for the external auditor to seek a letter of representation (written representations) from the management of the client company.Required: Explain why auditors seek letters of representation
You have been appointed the auditor of United Millers Company Limited, a medium manufacturing company which is quoted on the stock exchange.Required: Explain the purpose of such a letter
During the final stage of the first audit of Nairobi National Bank Ltd. You request theclient to provide you with a letter of representation. The Client reads representations you are requesting and refuses to furnish the letter. The client states its position to be as follows:-―You are asking us to tell you all manner of things which we appointed you to find out. You are requesting us to say such things as ‗all the transactions undertaken by the bank have been properly reflected in the accounting records‘and yet we pay you to carry out the audit. You should know whether these statements are true or not; Required: Describe the nature of the content of a letter of representation. Your answer should be illustrated with specific examples of items which may appear in a letter of representation
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Explain the purpose and principal contents of a letter of engagement

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