Weekly Assignment

(The Sri Lankan consumer mindset)

This is about how Sri Lankan customers do their buying of  goods. This is take from an article which interview with prasanna perera  .(Marketing and Management Consultant, Chartered Marketer)

01.What does the Sri Lankan customer look for Price or quality?

       In my opinion, Sri Lankans are very price conscious, but will not Accept any quality for a lower price. Further, the level of price sensitivity increases when income decreases In general most Sri Lankan look for value for money.

02.Are Sri Lankans Brand Conscious when purchasing product and Services?

     Men are more brand conscious than ladies. This true for most categories of products. Ladies become brand conscious for products they purchase for the family .in general brand consciousness increase with income growth . Upper income &upper middle income Sri Lankans are brand conscious.

03.what factors influence Sri Lankan buying customer behavior?

      Many factors com in to mind .primarily social factors such as family and friends are powerful influence of buying behavior .

                     In addition, age , income and occupation also influencing factors. Sri lankan becoming more and more western oriented in their lifestyle. Hence,lifestyle is also Influencing factor Across product categories, Such as food, beverage, clothing, footwear and entertainment.

04.Are Sri Lankan customers high risk takers?

     Definitely not .A moderate level of risk taking is what can be observed. only a very small segment of the market , can be classified as risk takers.

WEEKLY ASSIGNMENT

    SLAS 30 (RELATED PARTY DISCLOSURE)

01. What is related party?

       Parties are considered to be related if one party has ability to control the other party

       or exercise significant influence over the other party in making financial and other

       operational decision.

02. How can you define the word “control”?

      Ownership directly or indirectly through subsidiaries, or more than one half of the               

       Voting power of an enterprice, or substantial interest in voting power and the power                

       to direct ,by the statute or agreement ,the financial and operating policies of the        

       Management of the enterprise.

03. Which kind of  relationship are not related parties?

       a) Two companies simply  because they have a director in common.

       b) provider of finance,trade union,public utilities, government departments

            angencies,in the course of their normal dealings with an enterprise by virtue

            only of those  dealing

       c) a single customer,supplier,franchisor,distributor or general agent with whom

           an enterprise transact a significant volume of business merely by virtue of the

           resulting economic dependence

04. What are the disclosure requirement of related party ?

      In particularly we should pay attention for

• their remuneration and borrowings

          Because of the fiduciary nature of their relationship with the enterprise.

        • purchases or sales of goods (finished or unfinished)

        • purchases or sales of property and other assets

        • rendering or receiving of services

        • agency arrangements

        • leasing arrangements

        • transfer of research and development

        • licence agreements

        • finance (including loans and equity contributions in cash or in kind)

  

3^rd assignment,

 

Batticaloa makes headway

The country celebrated the first anniversary of the end of the conflict and the Batticaloa city is regaining its lost glory. All highways leading to Batticaloa are being renovated. Work on the Polonnaruwa-Batticaloa Road is almost completed and it takes a little more than an hour to travel between the two towns.

The Chenkaladi-Badulla A-5 Road and most of the by-roads too are under construction. Construction work on a new bridge at Kalladi is under way. In the city limit multi-storeyed houses and commercial buildings with glass and aluminum fittings are being constructed seen.

Though the main towns’ suburbs and villages on the main roads are being developed under peaceful atmosphere, the situation in the villages is not so rosy. The Eastern Province was liberated in July 2007 and even after three years development has not reached many rural areas in the province. Unnachchiya, a village 26 kilometres away from the Batticaloa town in Wawnathive DS division is one such village where people still face hardships.

Living conditions

The living condition of people is hard as they lack even the basic facilities. Steps need to be taken for these people to be brought on par with the rest of the country. Roads are in a dilapidated state. Thousands of bony stray cattle look for grass in dried paddy fields. Abandoned paddy fields and fertile lands, livestock and fish are the treasures in this area that have to be converted into productive economic activities. 

Threats

The frequent entry of wild elephants into the village is another threat to the lives of the people as well as their agriculture. The village does not have electricity. The high tension electricity line up to the village supplies electricity to the pump house of the tank and the STF camp. We face an acute shortage of drinking water and have to trek a long distance to fetch water. People in the Wawnathive village face serious difficulties but water from our tank is pumped to the Batticaloa town, he said.

The rural hospital has not been opened yet because there are no doctors, nurses or other staff. Only maternity clinics are held weekly at the hospital building. The education of the children is obstructed due to lack of teachers. People said that the teachers are coming to school around 9.30 am by the only bus that reaches the village from Batticaloa. They leave the school by 12.30 pm in the same bus.

Law and Order

Addressing the gathering the OIC of the Camp Inspector, Rathnamallale said that the people in the village had income sources before and after the conflict. They went hunting, cut timber from the forest and cultivated cannabis. After we liberated the area we established Law and Order and stopped all illegal activities. However, we have failed to provide alternative income sources for them and as a result they face great difficulties today.

Sri Mohan (32) out lined the hardships in starting economic activities in the village. Cultivation is impossible due to wild elephants' invasion. I want to start a poultry farm, but there is no electricity. Producers do not get a fair price for their products due to poor transport facilities. We sell milk at Rs. 25 a liter. Village fish production is purchased by a single trader who comes from the Batticaloa town and we get a very low price, he said.

Infrastructure

A government servant said that the situation in many rural areas such as Karaweddi, Wellawali, Mandoor, Mankandu, Pullumalai, Roogam and Kokadicholai are the same. Health and education services in these areas have deteriorated. There is a shortage of doctors and essential drugs even in the Batticaloa Hospital.

The Government has done many things to the province mainly in the restoring infrastructure. Most of the issues that directly affect the lives of the people in the area come under the Provincial Council (PC).

Education and Health are devolved subjects and the PC can solve these issues or bring them to the attention of the Central Government. Bureaucracy is another issue.

There is no co-ordination among the government agencies. For instance teachers of the Unnachiya School can work full day if the CTB reschedules its operations or provides another bus to the village, he said.

01.  How much time it will take to reach Polonnaruwa from Batticaloa, by completing the new Polonnaruwa-Batticaloa highway?

It will take more then about an hour to reach Polonnaruwa from Batticaloa

02.  What are the treasures of rural areas around Batticaloa?

                Abandoned paddy fields and fertile lands, livestock and fish are the   

                treasures of rural areas around Batticaloa.

03.  What are the threats, the people who are living in the rural villages around the 

Batticaloa faced?

1. Entry of wild elephants in to the villages is a big problem to lives of people and

   Also it directly effect with agriculture.

2. Lack of electricity is another problem.

3. And also drinking water problem is another big problem for them.

    Villagers face serious difficulties for having drinking water.

     Those are the main threats, people faced.

04.  What were the illegal income sources the villagers had before liberated the area?

Cutting timber from the forests, cultivating cannabis and going hunter were the illegal income resources people had before liberated the area.

05.  What had happened to the education sector and health care sector in this area?

Schools and Hospitals do not have recourses to provide even a lower level of service for people. Both sectors do not have enough staff to provide some service. And also lack of transport facility is affected indirectly for both sectors.

Change the way you look

Life is hectic. Everyone is in a race to earn his or her living. People are too busy and tend to neglect their own health too. Because of this, the number of people who are obese is rising every day. When they finally realize it, often it is too late to go for a quick remedy.

However, losing those extra bulges is not impossible at all. It is just a matter of changing bad habits into good habits. Some positive changes in your lifestyle will keep you in good shape. Eating habits and exercising patterns are the most important factors that affect the weight of the body.

Despite the popular belief, eating habits have a greater impact than exercises. However, it does not mean that exercising is not important. Let us give you some tips and tricks to lose those extra pounds and maintain the ideal weight for the rest of your life.

These days one of the main addictions of many people is eating junk food. These are easy to buy, easy to eat and give a good taste. However, did you know that those foods have adverse effects on your weight? If you do not believe this, experiment it on your own. Without changing any of the regular activities, stop the consumption of fast food for a month. You will see a quick drop in your weight. When you finally decide to give up junk food, it does not mean that eating from restaurants has to be stopped too.

Instead, every time when ordering a meal, see if those contain lots of fatty food like oil and sweets. Some websites provide the facility of checking the calorie content of various food items.

They even provide mobile applications, which make it easier to check even while ordering food at the restaurant. Though it is not very practical in Sri Lanka, it still can be used for at least western recipes. The portion size of the meal also plays a major role.

Even consuming healthy food in large potions can still be a reason for a weight gain. To avoid this, keep track of everything you eat including the amount. After a good workout session, a big portion of oily food will ruin the effect of the workout. Keeping a food diary and counting the calories are two popular methods which are used to track the food intake of a person.

Automatically, when we are conscious about the amount of calories we eat, our portion sizes get smaller. However, accidentally eating a large portion is not a reason to panic. Make the next meal smaller. That way your food intake will balance. Usually a woman should eat a minimum of 1200 calories a day; a man should eat at least 1500 calories.

QUESTIONS

01.                        What are the important factors that affect weight of the body?

Eating habits and exercising patterns are the most important factors                   that Affect weight of the body.

02.                        Why is eating habits important than exercising habit?

The main reason to be fat is having unnecessary foods. Therefore practicing a good eating habit is important than exercising patterns.

03.                        What is the main addiction of people these days?

       The addiction of people is, eating junk foods.

04. What are two popular methods which are used to track the food intake of a person?

Keeping a food diary and counting the calories are the popular   methods

            People used to track the food intake of a person.

05.                        How much of calories should eat by a person for a day?   

Usually a woman should eat a minimum of 1200 calories and a man should eat a minimum of 1500 calories for a day.               

Ass 02

Terms of Engagement (SLAUS 2)      

The purpose of this Sri Lanka Auditing Standard (SLAuS) is to establish standards and provide guidance on agreeing the terms of the engagement with the client.

The auditor & the client should agree on the terms of the engagement.           

The agreed terms would need to be recorded in an audit engagement letter or other suitable form of contract.

It is in the interest of both client and auditor that the auditor sends an engagement letter, preferably before the commencement of the engagement, to help in avoiding misunderstandings with respect to the engagement. The engagement letter documents and confirms the auditor's acceptance of the appointment, the objective and scope of the audit, the extent of the auditor's responsibilities to the client and the form of any reports.

Advantages of having an Engagement Letter

v    It avoids misunderstanding

v    It documents audit evidence

v    It clearly specifies the objective & the scope of the audit

v    It help the auditor in carrying out legal procedures

v    It confirms auditors acceptance of the engagement

Form & content of an Engagement Letter

1) Principal Contents

The form and content of audit engagement letters may vary for each client, but they would generally include reference to:

v    The objective of the audit of financial statements.

v    Management's responsibility for the financial statements.

v    The scope of the audit, including reference to applicable legislation,

regulations, or pronouncements of the Institute of Chartered Accountants

of Sri Lanka.

v    The form of any reports or other communication of results of the

engagement.

v    The fact that because of the test nature and other inherent limitations of an audit, together with the inherent limitations of any accounting and internal control system, there is an unavoidable risk that even some material misstatement may remain undiscovered.

v    Unrestricted access to whatever records, documentation and other information are requested in connection with the audit.

2) The Auditor may contain

The auditor may also wish to include in the letter:

v    Arrangements regarding the planning of the audit.

v    Expectation of receiving from management written confirmation concerning representations made in connection with the audit.

v    Request for the client to confirm the terms of the engagement by acknowledging receipt of the engagement letter.

v    Description of any other letters or reports the auditor expects to issue to the client.

v    Basis on which fees are computed and any billing arrangements

v    Arrangements regarding the planning of the audit.

v    Expectation of receiving from management written confirmation concerning representations made in connection with the audit.

v    Request for the client to confirm the terms of the engagement by acknowledging receipt of the engagement letter.

v    Description of any other letters or reports the auditor expects to issue to the client.

v    Basis on which fees are computed and any billing arrangements

3) When relevant, the following points could also be made:

v    Arrangements concerning the involvement of other auditors and experts in some aspects of the audit.

v     Arrangements concerning the involvement of internal auditors and other client staff.

v    Arrangements to be made with the predecessor auditor, if any, in the case of an initial audit.

v     Any restriction of the auditor's liability when such possibility exists.

v    A reference to any further agreements between the auditor and the client

Audits of Components

When the auditor of a parent entity is also the auditor of its subsidiary, branch or division (component), the factors that influence the decision whether to send a separate engagement letter to the component include:

v    Who appoints the auditor of the component.

v    Whether a separate audit report is to be issued on the component.

v    Legal requirements.

v    The extent of any work performed by other auditors.

v    Degree of ownership by parent.

v    Degree of independence of the component's management.

                                                                                       

Recurring Audits

The auditor should consider whether circumstances require the terms of the engagement to be revised and whether there is a need to remind the client of the existing terms of the engagement.

The auditor may decide not to send a new engagement letter each period. However,

The following factors may make it appropriate to send a new letter:

v    Any indication that the client misunderstands the objective and scope of the audit.

v    Any revised or special terms of the engagement.

v    A recent change of senior management, board of directors or ownership.

v    A significant change in nature or size of the client's business.

v    Legal requirements.

Questions & Answers

1)     What is the purpose of this Sri Lanka Auditing Standard (SLAuS 2)?

The purpose of this Sri Lanka Auditing Standard (SLAuS 2) is to establish standards and provide guidance on agreeing the terms of the engagement with the client.

2)     What are the Advantages of having an Engagement Letter?

v    It avoids misunderstanding

v    It documents audit evidence

v    It clearly specifies the objective & the scope of the audit

v    It help the auditor in carrying out legal procedures

v    It confirms auditors acceptance of the engagement

3)     What are the three contents include in engagement letter?

·        Principal Contents

                                     I.      The objective of the audit

                                  II.      Management's responsibility

                               III.      The scope of the audit

·         The Auditor may contain

                        I.Arrangements regarding the planning of the audit.

                     II.Expectation of receiving from management written confirmation concerning representations made in connection with the audit.

                 III.Request for the client to confirm the terms of the engagement by acknowledging receipt of the engagement letter.

                  IV.Description of any other letters or reports the auditor expects to issue to the client.

                     V.Basis on which fees are computed and any billing arrangements

·        When relevant, the following points could also be made

                              I.      Arrangements concerning the involvement of other auditors and experts in some aspects of the audit.

                           II.      Arrangements concerning the involvement of internal auditors and other client staff.

                       III.      Arrangements to be made with the predecessor auditor, if any, in the case of an initial audit.

                        IV.      Any restriction of the auditor's liability when such possibility exists.

                           V.      A reference to any further agreements between the auditor and the client

4)     What is the meaning of Audits of Components & what are the factors that influence the decision whether to send a separate engagement letter to the component?

The meaning of Audits of Components is the auditor of a parent entity is also the auditor of its subsidiary, branch or division (component).

     Factors that influence the decision whether to send a separate engagement letter

v    Who appoints the auditor of the component.

v    Whether a separate audit report is to be issued on the component.

v    Legal requirements.

v    The extent of any work performed by other auditors.

v    Degree of ownership by parent.

Degree of independence of the component's management

5)   What is the meaning of Recurring Audits?

The Auditor may decide audit for long time. It means that the auditor may decide not to send a new engagement letter each period.

Ass 02

Terms of Engagement (SLAUS 2)      

The purpose of this Sri Lanka Auditing Standard (SLAuS) is to establish standards and provide guidance on agreeing the terms of the engagement with the client.

The auditor & the client should agree on the terms of the engagement.           

The agreed terms would need to be recorded in an audit engagement letter or other suitable form of contract.

It is in the interest of both client and auditor that the auditor sends an engagement letter, preferably before the commencement of the engagement, to help in avoiding misunderstandings with respect to the engagement. The engagement letter documents and confirms the auditor's acceptance of the appointment, the objective and scope of the audit, the extent of the auditor's responsibilities to the client and the form of any reports.

Advantages of having an Engagement Letter

v    It avoids misunderstanding

v    It documents audit evidence

v    It clearly specifies the objective & the scope of the audit

v    It help the auditor in carrying out legal procedures

v    It confirms auditors acceptance of the engagement

Form & content of an Engagement Letter

1) Principal Contents

The form and content of audit engagement letters may vary for each client, but they would generally include reference to:

v    The objective of the audit of financial statements.

v    Management's responsibility for the financial statements.

v    The scope of the audit, including reference to applicable legislation,

regulations, or pronouncements of the Institute of Chartered Accountants

of Sri Lanka.

v    The form of any reports or other communication of results of the

engagement.

v    The fact that because of the test nature and other inherent limitations of an audit, together with the inherent limitations of any accounting and internal control system, there is an unavoidable risk that even some material misstatement may remain undiscovered.

v    Unrestricted access to whatever records, documentation and other information are requested in connection with the audit.

2) The Auditor may contain

The auditor may also wish to include in the letter:

v    Arrangements regarding the planning of the audit.

v    Expectation of receiving from management written confirmation concerning representations made in connection with the audit.

v    Request for the client to confirm the terms of the engagement by acknowledging receipt of the engagement letter.

v    Description of any other letters or reports the auditor expects to issue to the client.

v    Basis on which fees are computed and any billing arrangements

v    Arrangements regarding the planning of the audit.

v    Expectation of receiving from management written confirmation concerning representations made in connection with the audit.

v    Request for the client to confirm the terms of the engagement by acknowledging receipt of the engagement letter.

v    Description of any other letters or reports the auditor expects to issue to the client.

v    Basis on which fees are computed and any billing arrangements

3) When relevant, the following points could also be made:

v    Arrangements concerning the involvement of other auditors and experts in some aspects of the audit.

v     Arrangements concerning the involvement of internal auditors and other client staff.

v    Arrangements to be made with the predecessor auditor, if any, in the case of an initial audit.

v     Any restriction of the auditor's liability when such possibility exists.

v    A reference to any further agreements between the auditor and the client

Audits of Components

When the auditor of a parent entity is also the auditor of its subsidiary, branch or division (component), the factors that influence the decision whether to send a separate engagement letter to the component include:

v    Who appoints the auditor of the component.

v    Whether a separate audit report is to be issued on the component.

v    Legal requirements.

v    The extent of any work performed by other auditors.

v    Degree of ownership by parent.

v    Degree of independence of the component's management.

                                                                                       

Recurring Audits

The auditor should consider whether circumstances require the terms of the engagement to be revised and whether there is a need to remind the client of the existing terms of the engagement.

The auditor may decide not to send a new engagement letter each period. However,

The following factors may make it appropriate to send a new letter:

v    Any indication that the client misunderstands the objective and scope of the audit.

v    Any revised or special terms of the engagement.

v    A recent change of senior management, board of directors or ownership.

v    A significant change in nature or size of the client's business.

v    Legal requirements.

Questions & Answers

1)     What is the purpose of this Sri Lanka Auditing Standard (SLAuS 2)?

The purpose of this Sri Lanka Auditing Standard (SLAuS 2) is to establish standards and provide guidance on agreeing the terms of the engagement with the client.

2)     What are the Advantages of having an Engagement Letter?

v    It avoids misunderstanding

v    It documents audit evidence

v    It clearly specifies the objective & the scope of the audit

v    It help the auditor in carrying out legal procedures

v    It confirms auditors acceptance of the engagement

3)     What are the three contents include in engagement letter?

·        Principal Contents

                                     I.      The objective of the audit

                                  II.      Management's responsibility

                               III.      The scope of the audit

·         The Auditor may contain

                        I.Arrangements regarding the planning of the audit.

                     II.Expectation of receiving from management written confirmation concerning representations made in connection with the audit.

                 III.Request for the client to confirm the terms of the engagement by acknowledging receipt of the engagement letter.

                  IV.Description of any other letters or reports the auditor expects to issue to the client.

                     V.Basis on which fees are computed and any billing arrangements

·        When relevant, the following points could also be made

                              I.      Arrangements concerning the involvement of other auditors and experts in some aspects of the audit.

                           II.      Arrangements concerning the involvement of internal auditors and other client staff.

                       III.      Arrangements to be made with the predecessor auditor, if any, in the case of an initial audit.

                        IV.      Any restriction of the auditor's liability when such possibility exists.

                           V.      A reference to any further agreements between the auditor and the client

4)     What is the meaning of Audits of Components & what are the factors that influence the decision whether to send a separate engagement letter to the component?

The meaning of Audits of Components is the auditor of a parent entity is also the auditor of its subsidiary, branch or division (component).

     Factors that influence the decision whether to send a separate engagement letter

v    Who appoints the auditor of the component.

v    Whether a separate audit report is to be issued on the component.

v    Legal requirements.

v    The extent of any work performed by other auditors.

v    Degree of ownership by parent.

Degree of independence of the component's management

5)   What is the meaning of Recurring Audits?

The Auditor may decide audit for long time. It means that the auditor may decide not to send a new engagement letter each period.