July Journal - 1st Week

WEEK 1

Date:  1 July 2024 - 5 July 2024
Day : Monday - Friday
Location : BDO Office, Level 18, Menara Zurich
Time: 8.30 a.m - 6.00 p.m

TASKS OF THE WEEK 

Stocktake at Muar Warehouse

Day 66 ( 1 July 2024)

Stocktake and Asset Sighting at SK Berhad

The next day, I conducted a stocktake and asset sighting at SK Berhad, focusing on the finished goods for SKF and SKFI. We arrived at the client’s location at 8:30 AM, where the client provided us with a comprehensive list of items for the stocktake. I selected samples in line with our audit requirements.

En. Amran, who was responsible for the finished goods, and his coworkers assisted me by guiding me to the locations of the selected stock. I meticulously counted the items, ensuring that the quantities matched those recorded in the system. I completed the stocktake for finished goods by 11:00 AM.

After that, I continued with the stocktake for assets. Encik Arif, who was in charge of the assets, showed me the locations for each selected item. I documented the process by taking photographs of each asset, including their identification codes. The warehouse at SK Berhad was extensive, comprising five separate warehouses, which made navigation crucial for accurate asset verification.

Lessons Learned:

This experience taught me the value of thorough planning and collaboration during on-site stocktake. Working closely with client personnel not only facilitated the process but also ensured accuracy in counting and documenting. Additionally, I learned the importance of visual documentation; taking photographs of assets and their codes helped create a clear record for future reference. The complexity of navigating a large warehouse underscored the need for organization and systematic approaches in inventory management.

Day 67 ( 2 July 2024)

Crosscheck the Standard Request for Bank Report

The next day, I cross-checked the standard request letters for bank reports required for audit purposes for each company within SK Berhad for the financial year. My task involved ensuring that all relevant banks associated with each company were properly listed and that the request letters were thoroughly prepared. This meticulous preparation aimed to streamline the process for auditors when requesting bank reports during the audit.

Lessons Learned:

Through this process, I learned the critical importance of attention to detail in preparing documentation for audits. Ensuring that all relevant banks were included not only facilitates a smoother audit process but also minimizes delays in obtaining necessary information. This experience reinforced my understanding of the role that accurate and well-organized documentation plays in effective auditing, highlighting the need for thoroughness and proactive planning in our engagements.

Day 68 (3 July 2024)

Performing Related Party Transaction Working Paper

The next day, I focused on preparing the Related Party Transaction (RPT) working paper. The primary purpose of this working paper is to identify and assess transactions between the client and its related parties, ensuring that these transactions are disclosed in accordance with applicable accounting standards and regulations. This involves gathering information on the nature of the relationships, the terms of the transactions, and any potential impacts on the financial statements.

I carefully reviewed documentation related to these transactions, including contracts, invoices, and board meeting minutes, to verify that they were conducted at arm's length and appropriately disclosed in the financial statements. This process is crucial in ensuring transparency and compliance, as related party transactions can pose significant risks if not accurately reported.

Lessons Learned:

Through this experience, I learned the significance of understanding the complexities of related party transactions. Recognizing the potential for conflicts of interest and the necessity for transparent reporting deepened my appreciation for ethical financial practices. Additionally, I enhanced my analytical skills by scrutinizing various types of documentation, which improved my ability to identify discrepancies and ensure compliance. This task underscored the importance of diligence in financial reporting and the vital role that thoroughness plays in maintaining the integrity of the audit process.

Day 69 (4 July 2024)

Performing Related Party Transaction Working Paper

The next day, I continued working on the Related Party Transaction (RPT) working paper. I revisited the documentation and information previously gathered to ensure that all relevant transactions were accounted for and accurately reported. This involved cross-referencing additional data provided by the client and confirming that all transactions were properly disclosed in accordance with accounting standards.

I also engaged with team members to discuss any findings and clarify any ambiguities related to the nature of the relationships and the terms of the transactions. Ensuring consistency and accuracy in our documentation was essential for a comprehensive assessment of related party transactions.

Lessons Learned:

Through this repeated task, I reinforced my understanding of the nuances involved in related party transactions. I learned the importance of collaboration within the audit team to address complex situations and ensure thorough reviews. This experience highlighted the value of maintaining a systematic approach when analyzing such transactions, as it helps uncover potential risks and ensures compliance with disclosure requirements. Additionally, I became more adept at identifying subtle inconsistencies, which enhanced my attention to detail and critical thinking skills in the audit process.

Day 70 (5 July 2024)

Performing Related Party Transaction Working Paper

The next day, I continued my work on the Related Party Transaction (RPT) working paper for the other subsidiaries of SK Berhad. This involved gathering and reviewing similar documentation related to transactions between each subsidiary and their respective related parties. I meticulously analyzed contracts, invoices, and board meeting minutes to ensure that all relevant transactions were documented and disclosed accurately.

I also cross-verified the details with financial records to confirm that the transactions were conducted at arm's length and adhered to accounting standards. Engaging with the teams responsible for each subsidiary allowed me to clarify any discrepancies and ensure consistency in our findings across all entities. 

Lessons Learned:

Through this process, I learned the importance of adaptability and attention to detail when working with multiple subsidiaries. Each subsidiary may have unique relationships and transaction structures, necessitating a tailored approach to documentation and analysis. This experience improved my ability to efficiently manage multiple tasks and reinforced the value of effective communication within the team to ensure comprehensive coverage of all related party transactions. Additionally, I enhanced my understanding of how related party transactions can vary across different entities, deepening my analytical skills in assessing their implications on financial reporting.