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Auditing
Case study 1
(A)
| Stock Take Procedures | Audit assertions |
|
1.1 |
Rights and obligations |
|
1.2 |
Existence or occurrence |
|
1.3 |
Records completeness, accuracy, cut-off (correct accounting period) |
|
1.4 |
Valuation and allocation |
|
1.5 |
Records completeness |
|
1.6 |
Existence or occurrence |
|
1.7 |
Existence or occurrence |
|
1.8 |
Valuation and allocation |
|
1.9 |
Presentation and disclosures |
|
2.1 |
existence |
|
2.2 |
Records completeness |
|
2.3 |
Records completeness |
|
3 |
valuation and allocation |
|
4.1 |
Existence |
|
4.2 |
Obligation |
|
4.3 |
Records completeness |
|
4.4 |
valuation and allocation |
|
5 |
Records completeness |
|
6 |
presentation and disclosures |
(B). One of the procedures that could be added on the firm’s standard audit program is the confirmation of compliance with law and accounting standards. This involves checking whether the business entity uses the legal and quality accounting standards in keeping its books of accounts. Another process is the establishment of communication procedures. This involves the establishment of constant communication between the audit team and the corporate auditor for clarification of processes, the attainment of the relevant access to the documents and clarification of procedures. This is essential in ensuring non-redundancy of processes and procedures. It also saves on time in the acquisition of the necessary access rights to the required documents.
