You are the internal auditor of King Pepper (Pty) Ltd, a wholesale company that sells cell...

 

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You are the internal auditor of King Pepper (Pty) Ltd, a wholesale company that sells cell phone accessories to retailers such as Mr Phone-it and Phones 4U. Accessories are procured from various suppliers globally. From the discussion with client management, the following were noted pertaining to the purchases and payment cycle: a) The re-order levels and re-order quantities are set by a newly appointed graduate student (Mr Mokoko). Mr Mokoko graduated with distinction and used his knowledge of the process to set these levels. b) There is a creditors masterfile, to which access is appropriately controlled. Changes to the masterfile are strictly controlled although logs if amendments are not regularly checked. c) At regular intervals, say every Monday morning, a purchase requisition report will be generated from the purchasing department. This report contains inventory that have reached their re-order level Immediately after the report is printed, only that report will be taken to the ordering clerk a) The ordering clerk access the "create purchase order" module on the information technology system to create a purchase order. Once the ordering clerk has compiled the purchase order file, it will be available on the system for approval. Any person other than the ordering clerk can approve the purchase order. e) The approvers have full access to the create purchase order" module, in case there are any changes that are required on the purchase order. Access to the receiving goods" module is restricted to the ordering department. The supplier will alert them that the ordered goods are on its way. On date of delivery, the receiving clerk will receive the goods and notify the ordering clerk of the quantity received. The ordering clerk will then capture this on the receiving goods module REQUIRED 1. Compile 4 audit engagement procedures that will be performed at King Pepper (Pty) Ltd when determining whether correct and required goods are requested Ordering of goods function. (6) 2. Compile 2 audit engagement procedures that will be performed at King Pepper (Pty) Ltd when determining whether only valid purchase orders are generated. (3) 3. Compile 4 audit engagement procedures that will be performed at King Pepper (Pty) Ltd when determining whether all purchase transactions are accurately recorded. (6) You are the internal auditor of King Pepper (Pty) Ltd, a wholesale company that sells cell phone accessories to retailers such as Mr Phone-it and Phones 4U. Accessories are procured from various suppliers globally. From the discussion with client management, the following were noted pertaining to the purchases and payment cycle: a) The re-order levels and re-order quantities are set by a newly appointed graduate student (Mr Mokoko). Mr Mokoko graduated with distinction and used his knowledge of the process to set these levels. b) There is a creditors masterfile, to which access is appropriately controlled. Changes to the masterfile are strictly controlled although logs if amendments are not regularly checked. c) At regular intervals, say every Monday morning, a purchase requisition report will be generated from the purchasing department. This report contains inventory that have reached their re-order level Immediately after the report is printed, only that report will be taken to the ordering clerk a) The ordering clerk access the "create purchase order" module on the information technology system to create a purchase order. Once the ordering clerk has compiled the purchase order file, it will be available on the system for approval. Any person other than the ordering clerk can approve the purchase order. e) The approvers have full access to the create purchase order" module, in case there are any changes that are required on the purchase order. Access to the receiving goods" module is restricted to the ordering department. The supplier will alert them that the ordered goods are on its way. On date of delivery, the receiving clerk will receive the goods and notify the ordering clerk of the quantity received. The ordering clerk will then capture this on the receiving goods module REQUIRED 1. Compile 4 audit engagement procedures that will be performed at King Pepper (Pty) Ltd when determining whether correct and required goods are requested Ordering of goods function. (6) 2. Compile 2 audit engagement procedures that will be performed at King Pepper (Pty) Ltd when determining whether only valid purchase orders are generated. (3) 3. Compile 4 audit engagement procedures that will be performed at King Pepper (Pty) Ltd when determining whether all purchase transactions are accurately recorded. (6)

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Audit Procedures for the Sales Collection Are The sales and collections cycle in a business refers t... View the full answer