(c) (ii) Substantive analytical procedures – completeness of income for the year
– Obtain the sales income from the previous year. Multiply this by 115% to provide a rough estimate of the income for this year.
– Obtain information on the number of days with rain during the last year. Where this is more or less than 30, adjust the income estimate by 1/730 down for each day of rain above 30 or 1/730 up for each day of rain less than 30. (Note: B-Star only attracts 50% of the normal number of customers on a rainy day; hence one day of rain decreases total customers by 1/730 in the year.)
– Compare actual income to budgeted income for the year. Ask the directors to explain any significant deviations.
– Obtain industry information on the popularity of theme parks, and change in customer numbers. Compare these trends to the results obtained by B-Star. Where B-Star performed significantly better or worse than average, obtain explanations from the directors.
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