Financial Statements For the year ended
Understanding the group, its components, and their environments, including group-wide controls
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- Identifying significant components
| Understanding the group, its components, and their environments, including group-wide controls • Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determines our scope of each entity within the group which, when taken together, enable us to form an opinion on the group financial statements. We take into account size, risk profile, changes in business environment and other factors when assessing the level of work to be performed for each entity. Of all components, 2 are considered significant to the group based on consolidation numbers. These are the parent company and Certified Accountants Investment Company Limited. Specific procedures were performed on Certified Accountants Educational Projects Limited based on materiality of scoped items significant to the group. Based on significance, only analytical procedures were required on remaining entities. All work performed on components was completed by Grant Thornton UK LLP. • We have obtained an understanding of the entity-level controls of the group as a whole, including both the old and new accounting systems, the latter of which has taken effect partway through the year. Additional understanding regarding the controls associated with the new consolidation process was also gained due to changes in month-end consolidation of international subsidiaries and the related translation of foreign exchange upon consolidation. These procedures assisted us in identifying and assessing risk of material misstatement due to fraud or error, as well as assisting us in determining the most appropriate audit strategy. Identifying significant components • Significance of group components was determined by evaluating benchmark percentages of key sections, as compared to the group total. Anything identified above 15% of key benchmarks has been considered to be a significant component. Benchmarks considered included operating income, surplus before tax, assets and total expenditure For components that exceeded our benchmark, full scope audit procedures were completed. For those entities that did not, analytical review procedures were performed. |