Scribd
Upload
15 views1 page

Audit Practice Question

The audit of Saif Limited, a toy manufacturer, faces risks due to complaints about their popular 'Fighter Toy' which led to a product recall. Additionally, the company's decision to enter the saturated market of stuffed toys with newly imported machinery poses further risks. These factors could impact sales, reputation, and financial stability for the year ending 30 June 2024.

Uploaded by

www.jazi218
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
15 views1 page

Audit Practice Question

The audit of Saif Limited, a toy manufacturer, faces risks due to complaints about their popular 'Fighter Toy' which led to a product recall. Additionally, the company's decision to enter the saturated market of stuffed toys with newly imported machinery poses further risks. These factors could impact sales, reputation, and financial stability for the year ending 30 June 2024.

Uploaded by

www.jazi218
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 1

CAF-8 Audit and Assurance

Question:
You are the auditor manager responsible for the audit of a Toy Manufacturer, Saif Limited, for
the year ended 30 June 2024. The company, Saif Limited, specializes in a variety of children’s
toys. The following situation are under your consideration:
 During the year, a "Fighter Toy" was launched, which gained significant attraction among
children, and the company's sales increased due to its popularity. However, some
complaints have been received stating that it caused harm to children. Management has
responded by stating that they initiated a recall of the sold inventory.
 As a result of the situation with the Fighter Toy, the company decided to manufacture
stuffed toys. The company imported machinery for manufacturing stuffed toys, a market
that is already saturated with stuffed toys. By the year-end, samples of stuffed toys were
supplied to different suppliers.

Required:

Identify the risks in this situation.

Akash Mukesh Kumar, ACA

You might also like