Electro (Pty) Ltd entered into a cost–plus–a–fee contract with Ukwakha Construction (the contractor) to build the multipurpose processing plant adjacent to the man manufacturing plant. The contractor has to provide and furnish all personnel, services, all materials, and equipment required to build the plant, the contract includes a clause that allows Electro (Pty) Ltd to audit any of the processes associated with the cost –plus-fee contract. At the close of each calendar month, the contractor submits an invoice covering 100% of all costs incurred. One month into the contract the executive management of Electro (Pty) Ltd requests the internal audit department to perform an internal audit review of the labor and payroll activities of the contractor, the reason for the internal audit review is that the contractor has been appointed on a cost-plus-fee contract As an internal auditor employed by Electro (Pty) Ltd and assigned to the internal audit, you observe the following in respect of labor. Workers coming to the construction site each morning sign a log kept at the time keepers’ office on the project site, the contractor explains that each worker completes a daily time report, which is submitted to the payroll clerk in the field office at the end of each week. The payroll clerk then summarizes the daily time reports. At this time, the foreman and the supervisor sign the summary, which is forwarded to the home office for processing. The home office returns the payroll register along with the pay packets to the payroll clerk. On payday, the payroll clerk distributes the pay packets to the workers. The payroll clerks take any uncollected pay packets home with him and return them to the home office on the next working day REQUIRED 6.1 Since the executive management of Electro (Pty) Ltd requested the internal audit department to perform an internal audit review, what are the processes that an internal auditor need to follow while performing an internal audit review? (20) marks 6.2 You have just graduated with a diploma in internal auditing from the Vaal University of Technology. You decided to throw a party in order to celebrate your achievement, inviting a few of your neighbors, family and a few of your friends. And also during your spare time you go for exercises and sports games. You apply the steps in the risk management process to plan and execute your party. • Describe your vision, mission, strategic objectives, and strategy using the scenario above.

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