The internal auditor of Book Worm has just completed the annual planning meeting of the Audit Committee
Fantastic news! We've Found the answer you've been seeking!
Question:
The internal auditor of Book Worm has just completed the annual planning meeting of the Audit Committee and has agreed to the following objectives for the following financial year:
- To coordinate a review of the Purchasing and Accounts Payable functions, which will complement the external auditor's review of trade creditors and accrued charges.
- To perform an operational audit of the Purchasing function.
- To perform a review of inventory levels and the identification of the extent of any slow moving and obsolete inventory holdings
- To review the levels of risk relevant to the inventory levels in each store and the warehouse.
The purchasing department consists of the following:
- A supply manager, reporting to the managing director.
- A purchasing officer, reporting to the supply manager.
- An administrative support supervisor, who reports to the purchasing officer.
- Two administrative support officers, reporting to the administrative support supervisor.
Required:
- Describe the organisation of the Purchasing function and draw an organisation chart.
- Develop the audit plan for the operational audit of the Purchasing and Accounts Payable functions.
- Develop the audit plan to expand the operational audit into a financial audit that would meet the relevant external audit assertions for their audit of the financial reports.
- Develop a plan to identify slow moving inventory items and the procedures to be followed.
Related Book For
Auditing and Assurance services an integrated approach
ISBN: 978-0132575959
14th Edition
Authors: Alvin a. arens, Randal j. elder, Mark s. Beasley
Posted Date: