PKH & Associates, a Chartered accountant firm, is practicing in Mumbai since last two decades. Rahul got the opportunity to work as an article…

PKH & Associates, a Chartered accountant firm, is practicing in Mumbai since last two decades. Rahul got the opportunity to work as an article clerk with PKH & Associates. After completion of formalities of article clerk registration, Rahul is placed in the statutory audit team of the firm. CA P, the partner heading audit team, planned to take Rahul in the audit work of M/s Fox India Limited for the financial year 2023-24. Till last year, CA K was the head of the audit team for audit of M/s Fox India Limited. As it is the first assignment of Rahul, he was instructed by the partner to go through the audit file of M/s Fox India Limited for the financial year 2022-23 and familiarize himself with audit procedures and methodology to be followed for upcoming audit assignment. On-going through the audit file of F.Y. 2022-23, Rahul found revised engagement letter, other working papers relating to MAT & Deferred tax calculations and the following extract on verification of expenses: Name of concern M/s. Fox India Limited Financial Year 2022-23 Prepared by D (05.05.2023) Reviewed by F (06.05.2023) Approved by CA K (07.05.2023) Sr. No. Nature of Procedure Extent of Check Basis of Sample Done by 1. Vouch few expense invoices available in record of concern 10% Random Sampling D 2. Trace these invoices into the account books of the concern. 10% Random Sampling D 3. Verify few invoices with the GST data of the concern 10% Random Sampling D Rahul immediately drafted a revised engagement letter for the financial year 2023-24 and also specified the scope of audit to include the following statements: Statement I: reliability and sufficiency of financial information Statement II: proper disclosure of financial information, Statement III: responsibility of an auditor to prepare the financial statements, and Statement IV: coverage of all aspects of entity relevant to the financial statements being audited. He thought that it is mandatory to obtain engagement letter every year and handed over revised draft to CA P. CA P is surprised as to why Rahul drafted the same and explained him the situations under which it is necessary to obtain a revised engagement letter. Before finalizing the audit report of M/s. Fox India Limited for the F.Y. 2023-24, Rahul performed the following procedures regarding subsequent events: (i) Obtained an understanding of procedures established by the company to ensure that subsequent events are identified. (ii) Inquired management of the company as to whether any subsequent events have occurred which affects the financial statements as on 31.03.2024. (iii) Read the entity's latest subsequent interim financial statements. (iv) Read the minutes of meetings of M/s. Fox India Limited that have been held up to 31.03.2024. Based on the above facts, answer the following Q. Nos. 1 to 4.