The paper 'Auditing Using Controls to Protect Information Assets' is a great example of a Finance and Accounting Assignment. Using the work of an expert is important for an auditor since, it helps in providing accurate results. IN Auditing RPL, we will employ the work of an expert to appraise the value of depreciation due to a change in the rate of depreciation and its useful life. The work of an expert is important in appraising the value of an intangible asset which is imminent from the acquisition of MBL limited.
An inherent risk is conseq8ientrial from impairment of copyright of the medical journal books (Chris Davis 2011). Chapter 5: Question 5.30; what to be entailed in the engagement letter Communication with an outgoing practitioner I will communicate with the outgoing audit in order to get the first-hand information as to the reason for their resignation as well as identify if auditors' independence was not guaranteed. The internal Auditor’ s work Informing an audit opinion, an audit will employ as well as cooperate with internal audit 0of RPL. I will, therefore, appraise their competence as well as ascertain the internal control in order to ensure that placing reliance on the work on the internal audit will not be misleading (Graham J.
Hooley 2008). Chapter 6: Question 6.28; the inherent risk factors that arise from the nature of RPL’ s business operations: Effect of foreign currency translation It can be observed that RPL purchases 50% of its inventory globally with reimbursement being made in the currency in which goods were bought from. This depicts an inherent risk since the effect of currency translation and exchange rate must be accounted for at the time purchases occurs as well as lead to an effect on the account payables as well as the inventory and the balance will be misleading since the cash balance will be incorrect (Gupta 2012). Acquirement of MBL The acquisition of MDL leads to transformation in the business structure for RPL.
While the intangible asset such as the copyright for the medical books will experience impairment and hence depict an inherent risk Chapter 7: Question 7.28; A. Six control activities: Control Activities Nature of control The account makes the daily reconciliation of bank balances Manual control The segregation of duties between the debtors and the cash daily banking. Manual control The value posted in the account payable is accounted for by cashier Manual control The corroboration and singing of invoices are approved by the account receivable clerk. Manual control There is automation in the accounting system in order to ensure that the order processing does not go beyond the credit terms and limits. IT Application control The digital Library mechanically backup the tapes and stored elsewhere. IT general control B.
Two key internal control weaknesses An update of account receivable as well as the general ledger by Rebecca depicts some errors since; she isn’ t well conversant with order (Henning Kagermann 2007).
Also, the calculation of account payables as well as inventory is done by Kirby who is the account, payable clerk. The growth in consequence of errors as well as weakness in internal control will be observed as a result. C. Account balances at risk The sales and account receivables were bestowed on Rebecca and Bob Watkins. The data entry wasn’ t corroborated by any other assigned person. As a result, there are high chances that errors will be experienced since data are manually entered into the system.
The account payables as well as the inventory data entry are done by Clerk Kirby manually. With the presence of numerous transactions, there is a high chance that inaccuracy y in data entry will be experienced (Moeller 2010).
Chris Davis, SW 2011, IT Auditing Using Controls to Protect Information Assets, Springer , Sydney.
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