Internal Controls

Question 1

Outline of an auditor’s job in IC

Answer 1

1. Complete flowcharts and narrative notes
2. Conduct walkthrough tests
3. Conduct TOC
4. Revise audit plan and strategy

Question 2

Which is easier to apply in a variety of situations?, ICQ’s or ICEQ’s?

Answer 2

ICEQ’s

Question 3

Order forms should have how may parts of sequentially numbered order forms?

Answer 3

Four

Question 4

Standing data such as checking market prices of inventory against the up to date prices is done by whom?

Answer 4

An independent senior member of staff.

Question 5

Sale orders should automatically be recorded in the sales day book and receivable ledger on what basis (when)?

Answer 5

When orders are placed, just enter them off.

Question 6

Checking if more than one individual has posted the sale entries for what?

Answer 6

To check whether cash is not misappropriated. There is no assurance on accuracy or valuation.

Question 7

IA can assist the management by?

Answer 7

Undertaking mystery shopper reviews, going to shops as strangers and reviewing the experience

Question 8

Value for money

Answer 8

Focuses on three E’s
1. Economy
2. Efficiency
3. Effectiveness

Question 9

Economy

Answer 9

The lowest cost at which an appropriate quality and quantity of physical, human, and financial resources can be achieved.

Question 10

Effectiveness

Answer 10

The extent to which an activity is achieving its policy objectives

Question 11

Efficiency

Answer 11

the relationship between goods and services produced and the resources used to produce them