• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

PQ Awards Nominations

Please help us to win one of the PQ Magazine awards and send in the voting form >>
You can nominate us in any or all of the following categories: Online College of the Year, Study Resource of the Year, Private Sector Lecturer of the Year, and Accountancy Personality of the Year.

Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>

COMET PUBLISHING S/D17

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › COMET PUBLISHING S/D17

  • This topic has 5 replies, 2 voices, and was last updated 1 year ago by Kim Smith.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • July 14, 2021 at 3:33 am #627652
    Jiya024
    Member
    • Topics: 168
    • Replies: 56
    • ☆☆☆

    Professor, isnt the below one simply a business deficiency, rather than something like control deficiency?
    I don’t see how auditor should be concerned of this?

    “It is not possible for a store to order goods from other local stores for customers who request them. Instead, customers are told to contact the other stores or use the company website.
    Customers are less likely to contact individual stores themselves and this could result in the company losing valuable sales.
    In addition, some goods which are slow moving in one store may be out of stock at another; if goods could be transferred between stores, then overall sales may be maximised.”

    July 14, 2021 at 3:54 am #627653
    Jiya024
    Member
    • Topics: 168
    • Replies: 56
    • ☆☆☆

    query 2)

    Professor is there any specific reason why they have not mentioned the CONTROL DEFICIENCY related to LACK OF SEQUENTIAL NUMBERING of purchase orders processed by Oliver Dancer? because if Purchase orders are not sequentially numbered then Mr. Oliver could miss out on certain purchase orders leading to stock outs/manufacturing delays.

    July 14, 2021 at 4:17 am #627654
    Jiya024
    Member
    • Topics: 168
    • Replies: 56
    • ☆☆☆

    query 3)

    in the 3rd TOC the kit states that:

    “Undertake a sequence check of GRNs held by the accounts department and discuss any missing items with the accounts clerk.”

    why can’t the external auditor just:

    “REVIEW whether all GRNs are sequentially numbered and have a proof of evidence in the form of signature that sequential check was undertaken by accounts department.”

    I get a little confused ma’am as to when the auditor should “REVIEW” and when “UNDERTAKE” a certain activity themselves. Is there any exhaustive list which provides some definite guidance of what should be done, when a certain type of activity takes place/doesnt take place?

    July 14, 2021 at 7:53 am #627677
    Kim Smith
    Keymaster
    • Topics: 100
    • Replies: 6799
    • ☆☆☆☆☆

    1. You are absolutely right – as worded, these answer points have NO place in AA as business risk has not been examinable in AA for more than 10 years. It looks to me that this question and answer took some ideas from an old question from 2010 but overlooked this. It is certainly a shame that the answer starts with these points as it is can only confuse(!)

    July 14, 2021 at 7:59 am #627678
    Kim Smith
    Keymaster
    • Topics: 100
    • Replies: 6799
    • ☆☆☆☆☆

    2. But stock-outs/loss of manufacturing days is a business risk so not relevant. So unless you can think of a reason why sequential numbering is necessary (to prevent or detect and correct misstatements) its absence is not a deficiency.

    July 14, 2021 at 8:08 am #627680
    Kim Smith
    Keymaster
    • Topics: 100
    • Replies: 6799
    • ☆☆☆☆☆

    To undertake/perform/do a sequence check is to look at every number and spot at any number that is missing …

    20186
    20187
    20188
    20189
    20190
    20192
    20193
    20194
    20195

    That is different to flicking through a sheaf of documents and seeing that they all have a number in the top right-hand corner.

    You could OBSERVE an employee of the client performing a sequence check – and initialling something (a purchase order book, say) – to indicate that they have done so.

    You could INSPECT signatures to indicated that someone is supposed to have carried out the check.

    Or you can REPERFORM the sequence check (as I described above).

    They will all get credit because they recognise the same thing – that you are testing the control that is sequence checking.

  • Author
    Posts
Viewing 6 posts - 1 through 6 (of 6 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

 

ACCA My Exam Performance for non-variant Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

FREE Verifiable CPD for ACCA Members

ACCA mock exams and debrief videos

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Latest comments

  • John Moffat on Introduction to Financial Accounting – ACCA Financial Accounting (FA) lectures
  • John Moffat on PM Chapter 13 Questions Standard Costing and Basic Variance Analysis
  • abdallah254 on FA Chapter 2 Questions The Statement of Financial Position and Statement of Profit or Loss
  • Iby2012 on Introduction to Financial Accounting – ACCA Financial Accounting (FA) lectures
  • Iby2012 on Introduction to Financial Accounting – ACCA Financial Accounting (FA) lectures

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in


We use cookies to show you relevant advertising, find out more: Privacy Policy · Cookie Policy