Apollo Shoes Test of Control Procedures Purchasing Cycle Year Ending December 31 2007 Objective Describe the test of controls procedures to determine if reliable control exists Sampling Unit All purchase transactions Attribute description Strength S Weakness W Audit implications Test the control Control activity Prepared by C W Compensating audit procedures N A Supervisor approved purchase requisition Prenumbered purchase order prepared 5 copies of purchase orders disbursed Goods received 3 copies disbursed original dept receiving accounts payable Receiving Department files copy with purchase order copy Original department files copy Accounts payable compares with vendors invoice S 1 S 2 S 3 S 4 S 5 S 6 Segregation of duties Multiple copies to Authorization proper authorization Information Processing controls Physical controls Physical controls accuracy and record keeping Segregation of duties Proper authorization ensures accuracy Prenumbering ensures accurate record keeping Copies ensure accuracy of orders being disbursed different departments ensures accuracy Accurate records kept in different departments ensures accuracy This segregation ensures that the purchase order is accurate Inquiry and observation Inquiry and observation Inquiry and observation Inquiry and observation N A N A N A Inquiry and observation N A Inquiry and observation N A Control risk Apollo shoes appear to have good control on any risks of employees being able to commit fraud The internal controls appear to be in place correctly to ensure accuracy efficiency and segregation of duties to eliminate mistakes or overcharging of customers
View Full Document
Unlocking...