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Please remind me….
Was Qn 16 (b) as follows?List 6 deficiencies and give a recommendation regarding the Sales System….
Or was it asking for Test of controls and control objectives?
Regarding the last question about quality controls…..
It was a challenging one…. I wrote:The audit team can be more confident if supervised.
Supervision is necessary especially for new audit members for whom its the first audit.
Assists the team in identifying errors…Dont know if this is correct though 🙁
Benefits of planning audit;
Devote appr attention to significant matters
Identify potential problems at an earlier stage
Facilitate review
Carryout work effectively – organised and managed
To co-ordinate example with experts and internal auditors
To ensure the right number of staffs are available in the audit team with experienceAnd then one was for ethics…. I think it was:
Providing taxation services – Self review
Recruit a member of the Co – Self interest
Represent at authorities – AdvocacyAudit risks: AS PER MY ANSWERS:
New system introduced – risk of diff in opening balances during transfer or loss of data.
Dvlpmt costs – risk of capitalizing research costs… IAS 38
Training costs were capitalised
Purchases ledger closed after year end
No reco for bank stmts and control a/c – risk of fraud and errors.
Bonus based on total assets – risk of understatement of provisions…Anyone remember this qn in multiple choice?
Which of the following is NOT a relevant method for steps to take with regard to fees >15%
Answer was using separate engmt teams is not a relevant method.And adv and dis of the documents for recording sales.
Narrative notes and FlowchartsOrders should be chased as soon as 30 days pass…
Interest could be charged on payments exceeding 30 days.
Cash discounts for prompt payments.I agree….
But there were a few I can remember:– Goods not signed by customer during despatch
– Despatch notes not matched to original order
– Sales clerk gives discounts
– Sales clerk sets the credit limits
– Orders not sequentially numberedQn 18 – Benefits of planning audits
– Audit risks and responses
– Responsibilities for supervision and review (quality control)Qn 16 – Documenting sales system
Sales deficiencies and recommendations
Fraud procedures
Substansive procedures for revenue