I.15 points
The following are common audit procedures for tests of sales and cash receipts:
1.Compare the quantity and description of items on duplicate sales invoices with related shipping documents.
2.Trace recorded cash receipts in the accounts receivable master file to the cash receipts journal and compare the customer name, date, and amount of each one.
3.Examine duplicate sales invoices for an indication that unit selling prices were compared to the approved price list.
4.Examine duplicate sales invoices to determine whether the account classification for sales has been included on the document.
5.Examine the sales journal for related-party transactions, notes receivable, and other unusual items.
6.Select a sample of customer orders and trace the document to related shipping documents, sales invoices, and the accounts receivable master file for comparison of name, date, and amount.
7.Perform a proof of cash receipts.
8.Examine a sample of remittance advices for approval of cash discounts.
9.Account for a numerical sequence of remittance advices and determine whether there is a cross-reference mark for each one, indicating that it has been recorded in the cash receipts journal.
AcFn 3162 Auditing Principles & Practices Assignment-Addis Ababa University Africa.
a. Identify whether each audit procedure is a test of control or substantive test of transactions.
b. State which transaction-related audit objective(s) each of the audit procedures fulfills.
c. For each test of control in part a, state a substantive test that could be used to determine whether there was a monetary misstatement.
2.15 Point:
Assume you are accepting the financial statement audit assignment for a client having the following audit related information, identified by an independent consultant & finally confirmed by the engagement partner.
1.Significant material misstatement of financial statements
2.Significant Combined inherent & control risk
3.Illegal activity committed by top management
4.Wide spread thefts & misappropriations is the new normal practice of the company.
5.The name of the entity is associated with mass-media for Bad reputation.
6.All PESTELI (i.e. political, economical, social, technological, environmental, legal & other industry practices) are not in favor of the organization.
7.Disclaimer opinion is becoming the legacy of the entity.
8.Management’s intentional use of Dubious accounting policies to narrow expectation Gap’s on performances.
9.Visible violations of laws, regulations, agreements & contracts.
10.CORONA VIRUS PANDEMIC (Covd-19) significantly affects the way business is operating locally, national ly & internationally. Supply chain management at all levels of businesses are challenged . Particularly accounting estimates & judgments are the victims. faithful representation of financial statements is doubtful (HINT: for this condition particularly identify the BUSINESS RISKS, FINANCIAL STATEMENT RISKS & AUDIT RISKS RELATED TO THE GLOBAL PANDEMIC ASSUMING THE HOTEL INDUSTRY FORMIDABLY IMPLICATED)
AcFn 3162 Auditing Principles & Practices Assignment-Addis Ababa University Africa.
Based on the above conditions, events & circumstances identify the appropriate auditor’s responses, assuming that the auditor is accepting the engagement.
AcFn 3162 Auditing Principles & Practices Assignment-Addis Ababa University Africa.
1.Auditor’s staff assignment i.e. nature, composition, & status of auditor’s to be assigned.
2.The nature, timing & extent of subsequent audit procedures.
3.The professional skepticism & professional due care of the auditor.
4.To the assessment of detection risk of the auditor.
5.Auditor’s reliance on internal control system of the client.
6.Auditor’s considerations for the use of the experts.
7.Auditor’s assessments for sufficiency & competencies of audit evidences
8.Auditor’s communications to those charged with Governances for audit related matters.
9.Audit opinions & conclusions
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