AUI$2601/2/2024$

QUESTION $1$

$12$ marks

Extra Ltd is a company that is responsible for printing and distributing study guides for schools and universities across the country. The head office of Extra Ltd is situated in Johannesburg, Gauteng. The main warehouse is situated at the head office in Johannesburg with additional warehouses situated in each of the other provinces.

Printing of the study guides take place in Johannesburg at the head office. All study materials and guides are dispatched from main warehouse to the various warehouses in each province. From there it is then couriered to the various schools and universities.

Extra Ltd recently established an internal audit activity.

PART A

John Dlamini has been appointed as the chief audit executive $($CAE$).$ It became clear to John that the concepts relating to internal auditing is not clear to the management of Extra Ltd$.$

To ensure that management has a better understanding of internal auditing, John's first step is to describe to management internal audit's primary purpose and overarching goal.

John Dlamini realised that the responsibility of the CAE is to effectively manage the internal audit activity to ensure it adds value to the organisation.

REQUIRED

$1\mathrm{.}1$ Formulate the mission statement for internal auditing to describe internal auditing's primary purpose and overarching goal.

Marks

$(2)$

$1\mathrm{.}2$ What are the indicators of efficient management of the internal audit activity?