Verona Shoes - process. Outline four control procedures the...

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4551 Session 9 In-Class Group Exercise Verona Shoes Verona Shoe Company is considering automating its credit approval function. It manufactures a brushed pigskins shoe and acts as a wholesaler by buying closeouts of other brands and selling them to approximately 3,000 retail customers. The company has moved into new lines by recently acquiring the Canadian distribution rights to an important European brand of ski equipment and ski wear. The ski line will be sold to approximately 750 different retail outlets, but the major chains will constitute over 50% of the sales. Required: 1. a) What factors should the company consider in stetting its credit policies? b) How could data normally contained in the client’s computer system assist the company in setting its overall credit policies? Can you think of external sources that would be useful? 2. Assume that the company chooses to automate much of its credit approval
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Unformatted text preview: process. Outline four control procedures the company should consider to ensure that credit is granted only in accordance with credit policies. 3. For each control procedure identified, briefly indicate how the auditor might go about testing the effectiveness of its operation. 4551 Session 9 In-Class Group Exercise GROUP NAME:________________________________________________________ GROUP MEMBERS PRESENT: ___________________________________________ _______________________________________________________________________ Factors to Consider when Verona is its setting credit policy are: Data from the clients computer system that would assist (include external sources) 2. Control Procedures 3. Audit procedures to test control procedures: 4551 Session 9 In-Class Group Exercise...
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Verona Shoes - process. Outline four control procedures the...

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