Easy Life Sdn Bhd is a local distributor of electrical products. Customers are the mostly installers...

  

Transcribed Image Text:

Easy Life Sdn Bhd is a local distributor of electrical products. Customers are the mostly installers of this type of equipment. You discovered the following during your examination of the interim audit of the sales and collection cycle: 1 The warehouse has a cash and carry counter for retail customers. 2. The warehouse staff is in charge of generating sales invoices and credit notes for credit sales, as well as dealing with cash sales. 3 A significant number of credit notes were issued, account for roughly 10% of the total number of invoices issued. A review of the copy credit notes indicated they mainly resulted from arithmetic and pricing errors on the invoices issued. 4. 25% of credit customers were allowed settlement discounts of 3% even though payments were consistently received after the due date eligible for discount Required: You are required to make a conclusion as a result of interim audit Your report should highlight about the weaknesses, implication and recommendation to improve control in the sales and collection cycle. [Total: 16 Marks] You may use the following template to answer Question 2 & 4 No. Weaknesses Recommendation State the weakness (1m) + what is the Suggest solution (1m) + advantage from the effect from the weakness (1m) solution suggested (1m) 1 I Easy Life Sdn Bhd is a local distributor of electrical products. Customers are the mostly installers of this type of equipment. You discovered the following during your examination of the interim audit of the sales and collection cycle: 1 The warehouse has a cash and carry counter for retail customers. 2. The warehouse staff is in charge of generating sales invoices and credit notes for credit sales, as well as dealing with cash sales. 3 A significant number of credit notes were issued, account for roughly 10% of the total number of invoices issued. A review of the copy credit notes indicated they mainly resulted from arithmetic and pricing errors on the invoices issued. 4. 25% of credit customers were allowed settlement discounts of 3% even though payments were consistently received after the due date eligible for discount Required: You are required to make a conclusion as a result of interim audit Your report should highlight about the weaknesses, implication and recommendation to improve control in the sales and collection cycle. [Total: 16 Marks] You may use the following template to answer Question 2 & 4 No. Weaknesses Recommendation State the weakness (1m) + what is the Suggest solution (1m) + advantage from the effect from the weakness (1m) solution suggested (1m) 1 I

Answer rating: 100% (QA)

The Revenue Receivables and Receipts RRR Cycle also known as the Sales and Collection Cycle is made ... View the full answer