发布时间:2020-07-24  | 点击数:1434

由于行动受限,这种大流行给全球经济带来了前所未有的不利影响,特别是对航空运输业而言。本文旨在分析美国航空公司领导者达美航空公司(Delta Air Lines,Inc.)受冠状病毒的影响,并探讨其如何影响达美2020年的年度审核。本文基于季度财务结果,并辅以审查分析程序并符合AICPA标准。在这种情况下,本文着重于审计意见制定过程的中间三个阶段。结合财务数据审查,对公司提供的定性信息进行了分析。


The pandemic is bringing unprecedent adverse impact to global economy, especially for air transportation industry due to the limits on movement. This paper aims to analyze how Delta Air Lines, Inc. (Delta), the U.S. airline leader, is affected by the Coronavirus, and to find out how it may impact Delta’s 2020 annual audit. The paper is based on the quarterly financial results with the assistance of review analytical procedures and in accordance with AICPA standards. In this context, the paper focuses on the middle three phases of the audit opinion formulation process. An analysis of the qualitative information provided by the company is conducted in combination with financial figures review.



Delta Air Lines (Delta) is the U.S. global airline leader in many aspects including its services, reliability and customer experience. It is committed to delivering a world-class travel experience as well as generating high investor returns. Delta provides airline services to more than 200 million customers each year and takes them to more than 300 destinations in over 50 countries (Delta, 2020a). 

第三,针对由于客户固有风险而导致重大错报的可能性,审计师应获得充分适当的证据,以增加对错报风险的评估。预计将实施广泛的性质,时间安排和响应范围。 AU-C 300还指出,应将资源分配给特定的审核区域,作为总体审核计划的一部分。


The reason why I choose Delta is that the company operates in the air transportation industry which is under unprecedently impact of the Coronavirus, and the company’s operating performance interests me. As the announcements of limits on movement, there is a significant decline in the number of passengers for airline companies. Even after the limits unwind, there is a great possibility that most passengers will choose to wait a few months before travelling.  

Based on the research, about two-thirds of the world’s 26,000 passenger aircraft are grounded and a $314 billion shortfall in sales is likely to happen this year (Whitley, 2020). Therefore, this paper aims to analyze how Delta is affected by the Coronavirus, and to find out how it may impact the 2020 annual audit for the company.

Impact on the Audit Plan

There are five phases of the audit opinion formulation process and it is assumed that the client has been accepted.

When it comes to the second phase, it is vital to identify and assess the risks of material misstatement and to plan the audit accordingly to respond to the identified risks of material misstatement. First of all, it is necessary to assess the client’s going concern, and it will be a key and primary focus of the audit. In fact, researches have shown that many carriers might be faced with potential bankrupt because of the huge shortfall and insufficient cash flows. As shown in Appendix B, Delta’s net income to sales changes from positive to negative. During the first three months’ operation, its net loss takes up 6.2% of total passenger revenue.

Secondly, as this situation is unprecedent, auditors need to carefully re-evaluate the risk of material misstatement because the previous risk level of the client might be improper and requires professional discretion. As discussed in the Note 2. of the 10 Q financial statement, certain countries that are Delta’s major markets gradually put bans on cross-border travellers(Delta, 2020b). Specifically, the level of inherent risk of Delta is likely to increase. The change in overall economic climate in the industry could be regarded as business risks which will impact inherent risk at the financial statement level according to chapter 7. Meanwhile, under the impact of the pandemic, Delta adopts a new standard regarding credit losses that it effective from the beginning of 2020 (Delta, 2020b).

Thirdly, in response to the high likelihood of material misstatement due to inherent risks of client, auditors should obtain sufficient and appropriate evidence with increases in assessment of risk of material misstatement. Extensive nature, timing, and extent of responses are expected to be implemented. AU-C 300 also states that resources should be allocated to specific audit areas as a part of the overall audit planning. 

此外,AU-C 708要求审计师评估会计准则变更的适当性。由于达美航空根据ASU No.2016-13主题326采用新的信用损失模型,因此审计师需要评估其是否符合适用的会计准则。

Specific Areas of Testing

Specific areas of testing should be necessarily increased to obtain sufficient appropriate audit evidence.   

Revenue recognition is definitely the highest risky area that requires in-depth investigation, especially under the impact of the Coronavirus. Auditors should treat it as a fraud risk factor and extensive substantive procedures should be carried out regarding the occurrence and accuracy of revenues. Referring to the Appendix B, the sales mix of operating revenues does not change much amongst revenues from passengers, cargo and others. However, the impact of the Coronavirus is likely to undercut the passenger revenues more compared to others. But a comparison with the industry condition is needed while deciding the potential changes. It is notable that during the initial period, Delta might need to cut its prices and offer more promotions to woo passengers back. Therefore, 2020 annual audit should be carefully planned to embrace the changes in pricing policy, and to examine the accuracy of Delta’s revenues.

Accounts receivable account is closely connected with revenues, thus its existence and valuation should be carefully examined as well. According to the Appendix A, the accounts receivable to total assets experiences a slight decrease from 4.4% to 3.3%. The change in accounts receivable is expected to move in the same direction as sales. In the meanwhile, the aging of accounts receivable and debt expenses needs to be evaluated considering the financial position of major customers can be impacted by the downside of economy as well.

Another high-risk area might be connected with cash and cash equivalent account. Referring to the Appendix A, the proportion of cash equivalents to total assets in 2020 is significantly higher than that of 2019. Nonetheless, the liquidity and cash assets do not decline as an expected result of the pandemic. As stated in the notes, Delta puts enhancing liquidity as its priority in response to the pandemic and takes measures to achieve that. But the existence and valuation of this account should still be thoroughly investigated.  

Moreover, AU-C 708 requires auditors to evaluate the appropriateness of changes in accounting principles. As Delta adopts a new credit loss model under ASU No.2016-13 Topic 326, auditors need to assess whether it is in compliance with applicable accounting standards.

Implications from the Code of Conduct

The Coronavirus is impacting every one’s life and the entire economy. During this period of uncertainty, all the practitioners should encounter these new challenges and continue to provide high-quality auditing or accounting services to the client and the public.

There might be some circumstances where auditors are faced with ethical conflicts. For instance, some companies might intentionally overstate its revenue to maintain going concern and profitability. The auditor might have detected this fraud but reporting it can lead to confidentiality issues. In the face of ethical conflicts, auditors should take a series of steps to better achieve compliance with the rules and the law as required by the Code of Professional Conduct 1.000.020 Ethical Conflicts.

In the meantime, due care principle is especially important for auditors during this unprecedent period. On one hand, a member should observe the updated technical and ethical standards, maintaining his/her competence even during the quarantine, especially when continuous updates on practices are issued by AICPA to cope with rapid changes in global economy. On the other hand, under the current situation, some audit might need remote work including inventory count. In this case, members should be diligent in delivering high-quality assurance services to client and carefully render services as required by the Code.