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Respected Lecturer,
Is it a weakness in the internal control systems if there are no system notes (documentation of the processes of the internal control systems)?
If they are none, do auditors have to document it?That’s an interesting question (actually, two questions)
Internal control systems tend to evolve over time. As auditors make recommendations on how to improve the strength of an internal control matter, or the client’s personnel develop controls, so the system will become stronger over time. I don’t ever remember seeing a manual at a client with the title “Official Record of the Internal Control System: its Purpose and History”
If the client doesn’t have one, do the auditors have to document it? Well, from your F8 days you should remember that the auditors need a thorough understanding of the client’s systems and the only way they are going to have that understanding is if they have documented the system and have that record on file
Thank you sir. Im not yet attempting ACCA P7. But this was a little debate a friend and I had. And being an audit clerk this will definitely help me in the future .
You’re welcome – and get more of your friends to join in the discussion! The more people use the facilities of Opentuition, the happier we are 🙂
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