West Point Industries Group Audit Issues ReportTable of Contents1. Executive summary2. Introduction3. Discussion4. Audit issues in KPMGi's audit of West Point. Failure to Obtain Evidenceii. Failure to provide appropriate audit opinions:iii. Insufficient fundraisingiv. Failure to identify the solvency of the Companyv. Failure to follow instructions from company authorityvi. Expectation gap5. ASIC action against KPMG and West Point6. Conclusion7. ReferencesSummary: The West Point group of companies was an Australian-based company engaged in property development activities throughout Australia. To expand its business, West Point obtained loans from numerous banks, but supplemented these secured loans with risky, unsecured mezzanine financing it received from wealthy financial planners, after which it collapsed. in January 2006. Failure to provide appropriate audit opinions as in Following a subsequent investigation by ASIC, West Point was found to have breached a number of accounting standards and policies relating to disclosures before investing the money and then paying interest on capital investments rather than profits, KPMG auditors failed to qualify audit opinions based on breaches of Australian accounting standards. Three KPMG partners, namely Brett Charles Fullarton, Robert Charles Kelly and Jonathan Grant Robinson, were involved in the audit of the group of West Point companies that were banned by corporate watchdog ASIC. Unable to identify the company's solvency, ASIC took action against KPMG for conducting a negligent audit of West Point and failing to identify issues relating to solvency...... middle of paper .. ....the crime court is also initiated under section 50 of the ASIC Act for compensation for the loss caused by the informal audit carried out by KPMG. ASIC has already separately commenced action against the directors and officers of the West Point Group as well as a trustee and several financial services licensees. CONCLUSIONThe West Point group of companies was one of Australia's largest giants, dealing in real estate and real estate businesses which became insolvent and went into liquidation for many reasons including soft audit of a large auditing firm KPMG. ASIC took action against certain KPMG auditors and recovered a huge sum from them in compensation for damages caused by their conduct. REFERENCES: www.asic.gov.auwww.kpmg.com.auThe Business Journal, 2011, Andrew Burrell. , Publication No. 11-04, KordaMentha