Question 1 (20 marks) PART A (8 marks) Riley's Kitchen (Pty) Ltd is a small business that manufactures and sells home cooked meals from an online platform. Customers are required to create an account online before being able to make purchases. Customers select items that they want to purchase from a drop-down menu on Riley's Kitchen's website, and once they have confirmed their selection, the customer proceeds to a payment page. Customers have the option of paying via credit card at check-out or cash on delivery. When a customer has opted to pay with cash on delivery, the company's driver collects the cash from the customer. The driver keeps the cash on him until such a time that he has accumulated what he deems a large sum of money. The driver then hands the cash over, in a sealed envelope, to the accounting clerk, together with all the relevant delivery notes. The accounting clerk keeps all envelopes from drivers sealed in her desk drawer until a bi-weekly wage pay-out occurs. Money not applied for the wage pay-out, is banked. YOU ARE REQUIRED TO: (a) Once a customer has successfully logged into his/her account, explain which controls you expect to be present over orders placed on Riley's Kitchen's accounting system. (3) (b) Identify weaknesses in the cash-receipts procedures explained in the scenario and provide suggestions to address these weaknesses. (5) PART B (12 marks) You are a senior trainee on the audit of ProClean (Pty) Ltd, a company that provides monthly professional cleaning services to offices, apartment blocks and holiday resorts. The existence of accounts receivables has been identified as a high-risk area. As part of your on-the-job training, you are responsible for coaching a first-year audit trainee. YOU ARE REQUIRED TO: (a) Explain to the trainee two major procedures used for existence testing for trade receivables. (2) (b) Explain to the trainee how a debtors' circulation is performed. (8) 2 | P a g e (c) Apart from the existence assertion, explain to the trainee which other assertions relate to the accounts receivable balance. (2)