Crest Outfitters is a retailer and wholesaler of bags and camera accessories. It produces over 70...

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Crest Outfitters is a retailer and wholesaler of bags and camera accessories. It produces over 70 products, and hundreds of people work full-time at partner factories manufacturing their products. Crest Outfitters doesn't have any physical stores. Instead, it sells through its own website and other online outlets such as Amazon, and makes sales wholesale to retailers (who have physical and/or online outlets). You are appointed as the audit engagement partner of Crest Outfitters. Question 1 (900 words): You are responsible for the evaluation of internal controls regarding the 2 accounts in their financial statements: • Investment account, and Accounts payable account You need to answer following questions and record your assessment outcomes in the working paper. Investment account Account payable account Identify transaction related to each account. Determine "what can go wrong" (WCGW). Describe risks associated to financial statement accounts and Assertions related to investment and accounts payable. Identify internal controls in place to prevent or detect the risk of misstatement. Evaluate control risks. Comments on strength (minimum 1 item) and weakness (minimum 1 item) of the client's internal controls for investment and accounts payable. Question 2 (700 words): You are responsible for control tests regarding investment and accounts payable related accounts at Crest Outfitters. You need to describe the required audit procedures to perform control tests of investment and accounts payable related accounts at Crest Outfitters. Answer following questions and provide your audit plans in the working paper. Identify objectives/assertions related to control tests. Determine controls activities related to assertions. Describe the extent of internal control tests. Apply appropriate procedures or techniques for control tests. Investment account Account payable account Crest Outfitters is a retailer and wholesaler of bags and camera accessories. It produces over 70 products, and hundreds of people work full-time at partner factories manufacturing their products. Crest Outfitters doesn't have any physical stores. Instead, it sells through its own website and other online outlets such as Amazon, and makes sales wholesale to retailers (who have physical and/or online outlets). You are appointed as the audit engagement partner of Crest Outfitters. Question 1 (900 words): You are responsible for the evaluation of internal controls regarding the 2 accounts in their financial statements: • Investment account, and Accounts payable account You need to answer following questions and record your assessment outcomes in the working paper. Investment account Account payable account Identify transaction related to each account. Determine "what can go wrong" (WCGW). Describe risks associated to financial statement accounts and Assertions related to investment and accounts payable. Identify internal controls in place to prevent or detect the risk of misstatement. Evaluate control risks. Comments on strength (minimum 1 item) and weakness (minimum 1 item) of the client's internal controls for investment and accounts payable. Question 2 (700 words): You are responsible for control tests regarding investment and accounts payable related accounts at Crest Outfitters. You need to describe the required audit procedures to perform control tests of investment and accounts payable related accounts at Crest Outfitters. Answer following questions and provide your audit plans in the working paper. Identify objectives/assertions related to control tests. Determine controls activities related to assertions. Describe the extent of internal control tests. Apply appropriate procedures or techniques for control tests. Investment account Account payable account

Answer rating: 100% (QA)

Question 1 Working Paper Investment Account Transactions Purchase and sale of investments interestdividend receipt WCGW Incorrect valuation of investm... View the full answer