Tute 03.docx - Question 1(1 Test of balance(2 Test of disclosure(3 Test of transaction – Assertion is occurrence(4 Test of control Evidenced by

Tute 03.docx - Question 1(1 Test of balance(2 Test of...

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Question 1 (1) Test of balance (2) Test of disclosure. (3) Test of transaction – Assertion is occurrence (4) Test of control. Evidenced by signature or stamps, etc. (5) Substantive Analytical procedures (6) Test of detail. Test of control – inspect for evidence of authorisation Question 2 (a) Prevents company from incurring complications/complaints from customers and preventing errors e.g. expensing the customers for wrong amount of goods. Assess/detect alterations or questionable items and provides the Clerk with direct personal knowledge of their existence and physical condition (b) Auditor would examine shipping note (because that’s where the signature lies) (c) Iv. Inspection (observation – would relation to observing functions) v. Purchase Order vi. That the goods actually exist – Assertion of Completeness. Occurrence – sales recorded are actually those that took place. A R = I R ×C R × D R Question 3 Planned detection risk - Failure of auditor’s procedure to identify material misstatements
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