Moss Green Ltd

Question 2

Moss Green Ltd is a wine grower and producer of medium – to high-quality wines located in Western Australia’s Margaret River region. The company has recently listed on the Australian Securities Exchange. After listing, it changed auditors from Tickit Associates to your firm, Watson and Partners. You are an audit supervisor in Watson and Partners and you are planning the audit for 31 December 2011.

The managing director of Moss Green Ltd is Tom Green. He is the founder of the winery and has a very ‘hands on’ management style. He is a trained winemaker and has always focused more on the wine maldng and marketing side of the business than the financial side, which he leaves to Wendy Chong, the financial director, in whom he has great faith. He pays her a good base salary and provides an attractive bonus scheme based on growth in net profitability…

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