QUESTION $2$

$(22$ marks$)$

The chief audit executive $($CAE$)$ of LOVETAG Limiteds internal audit function $($IAF$)$ enquired whether you could provide him with advice on different audit approaches that can be followed by internal auditors. He observed that the recommendations made lately in the internal audit reports that he signed off, referred only to recommended steps to improve internal controls and enquired whether you are aware of any other types of audit engagements that can add value to the organisation.

REQUIRED:

PART A

$(6$ marks$)$

Discuss in detal three $(3)$ different types of audit engagements that are most offen performed by internal audtors. Complete your answer using the following template:

$\backslash$table$[[$Types of audR,,,$],[$engagements$,,,],[\backslash$table$[[$Auditengage$--],[$ment objectives$]],,,]]$

PART B

$(16$ marks$)$

During the planning and performance of the above$-$mentioned audit engagements, the IAF conducted, amongst others, the following activities:

$1$ The IAF had a meeting with management and statf to obtain an understanding of the processes and systems used.

$2$ The IAF obtained financiat information and did extensive comparisons and investigated trends and relationships.

$3$ The IAF used an excel spreadsheet to document the job descriptions of management and statt in the sales department $($rows$)$ and the specfic internal control activites in sequence $($columns$)$ indicating clearly which staff members are responsible for which activites.

$4.$ The LAE used a print$-$eut of the logive transactions for the month $($obeained from the human resource manager$)$ as well as a sample of leave application forms to assess whether all leave transactions are valid.