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Hi sir, in my textbook the methods of documenting the client’s system include, narrative notes , flowchart, organisation chart, internal control questionaire , internal control evaluation questionaire.
For september 2016 exam question 16(a), in the answer key, they stated all the methods above, except for the organisation chart. Why is that so ?
Are Organisation charts inappropriate to document the sales system ?
It is unusual to list organisation charts as a way of documenting an accounting system as that usually means following invoices etc, seeing where they are authorised, understanding how the are posted to the right accounts etc.
However, an organisation chart can be of some use because parts of internal control are segregation of duties and authorisation. The organisation chart can give some information about those elements of internal control.