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Internal Control Procedures: As an auditor, you have discovered the following problems with the accounting system control procedures of Jim's Supply Store. For each of the following occurrences, tell which of the control procedures was lacking. Also, recommend how the company should change its procedures to avoid the problem in the future. A. Jim's Supply Store's losses due to bad debts have increased dramatically over the past year. In an effort to increase sales, the managers of certain stores have allowed large credit sales to occur without review or approval. B. An accountant hid his theft of $200 from the company's bank account by charging the monthly reconciliation. He knew the manipulation would not be discovered. C. Mark Peterson works in the storeroom. He maintains the inventory records, counts the inventory, and has unlimited access to the storeroom. He occasionally steals items from inventory and hides the theft by including the value of the stolen goods in his inventory count. D. Receiving reports are sometimes filled out days after the shipment has arrived.
The Use of Engagement Letters There is a contractual relationship among an accountant and his client. The accountant must therefore make sure that at the time he decided to exe
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Contents of Working Papers - Audit The ISA 230 No.3 stresses which audit working papers may always be adequately complete and detailed to enable an experienced auditor along w
The modern integrated audit approach combines elements of various traditional audit areas having financial, operational, and information technology.
Classification of Management Representations The thing to note is which during the course of the audit the auditor obtains various representations from the management which ca
Forms of evidence a) Observation: is usually witnessing internal control and book-keeping procedures. It includes attendance at wages pay out. Observation of stock-take, open
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