Auditing Assigment Qantas Case

Content

Executive summary

1. 0 Business operation of REX
1.1 Nature of revenue sources
1.2Conduct of operation
1.3 Products and services
1.4 Market conditions and competition
1.5 Regulatory environment

2.0 PEST analysis
2.1 Political
2.2 Economics
2.3 Social
2.4 Technical

3.0 Audit risks
3.1 Measurement risk of aircraft
3.2 Revenue manipulate risk
3.3 Derivative financial instruments risk
3.4 Employee benefit risk

4.0 Internal control

Reference

Executive summary
Regional Express Holdings Limited (Rex) is an Australia-based airlines. The Company operates through three segments: regular public transport revenue, charter revenue and training revenue.

This report contains Four major parts.

In first part, it analyze business operation of REX by elaborate the sources of revenue, conduct of operation ,products and services, etc.

And then we use PEST model to evaluate external environment influences that have been particularly important in the past of the company.

Furthermore, this part explained that Four key audit risks which would impact on the financial report. It includes Measurement risk of aircraft, Revenue manipulate risk, Derivative financial instruments risk, Employee benefit risk.

At the end, it provides practical internal control respectively which could mitigate the risk.

1.0 Business operation
1.1 Nature of revenue sources

Source: Annual report for the financial year ended 30 June 2011 Regional Express Holdings Limited
Revenue from providing air passenger and freight services is recognized when the relevant flights are made.
1.2 Conduct of operations
Regional Express Holdings Limited was incorporated on 12 February 2002, and is listed on the ASX. It is the holding company of the following subsidiaries.
Regional Express (Rex) is Australia’s largest independent regional airline. It services various regional routes. It is the sole provider in the majority of its routes which are too small to be