The independent auditor assesses the level of control risk to determine the extent to which various auditing procedures must be employed. A client who uses a computer should provide the CPA with a flowchart of the accounting system so the CPA can evaluate the control features in the system. On page 326 is a simplified flowchart, such as a client might provide. Unfortunately the client had only partially completed the flowchart when it was requested by you.

1. Indicate the major weaknesses of this flowchart.

2. Describe what each blank item in the flowchart indicates. When complete, your description should provide an explanation of the processing of the data involved. AICPA adapted

Data from page 326

Transcribed Image Text:

ORDERS FROM SALESMEN POSTING MACHINE INVOICE PREPARATION CHARGE SALES INVOICES RUN NO. 1 COPY 3 TO SHIPPING COPIES 1 and 2 COPY TO CUSTOMERS BATCH TOTAL FROM MAILROOM CASH REMITTANCE ADVICES KEYPUNCH AND VERIFY RUN NO. 3