70%(10)7 out of 10 people found this document helpful
This preview shows page 2 - 6 out of 8 pages.
. The main purpose of the exit interview is to ensure that there are no errors in the audit report when issued.m) 4 is correct - all of the abovePage 2of 8
Acc653.F16.Midterm.Solutions Summaryn) 4 is correct – all of the aboveACL performs computer-assisted auditing functions, specifically the following: counting, footing, extensions, scanning, and listing of data, performing recalculations and aging, exception reporting, extraction and file processing, sampling (attribute and dollar unit sampling), sorting, indexing, and summarizing, file merging, matching, and multi-file processing, creating reports andconfirmation letters.o/ #3 is correct The use of electronic working papers can help achieve a standard structure and improve audit department efficiency.Audit files must meet the following criteria:They must be complete and accurate: show the nature and extent of the audit work done, and provide proper support for audit decisions, findings, conclusions, recommendations, and opinions.They must be clear and concise, requiring no supplementary oral explanations.They must be pertinent, containing only information that is relevant, important, and useful with respect to the objectives established for the examination.Part B questions (1) re: ch11 DQ3, but includes reference to ch6 Control Activities/Types and Levels (including information and communication controls and CAATs; 2) re; ch3 and the Governance Umbrella; and 3) theAudit Charter)Section B: (for a total of 35 marks)Question B.1 IT Governance (10 marks)IT governance has become a “hot topic” in recent years. Key components of governance oversight include Stakeholders that apply a “Governance Umbrella” that (in turn) includes Risk Management that can (under COSO) be seen as the responsibility of Senior Management and Assurance that takes into account both Internal and External Activities. RequiredDescribe how the “Governance Umbrella” and its components specifically relate to governing IT objectives and risks of an organization.Question B.2 Cash Receipts – use of CAATs (4 marks)You just received an offer of a full-time job in the Internal Audit department of a medium-sized manufacturing company. Your supervisor has not used Computer Assisted Audit Techniques (CAATs) and is also new to statistical sampling (usually using judgment only). Please outline 3 prerequisites that need to be in place before CAATs can be applied and the 2 types of CAATs that can be used. You have also been suppliedwith the following information: 1) ARACR (Risk of Assessment Control Risk Too Low) = 5%; Tolerable Error Rate = 8%; Estimated Population Deviation Rate for Tests of Controls = 2%. Please determine (using the table F-2 below) the Initial Sample Size for each attribute Page 3of 8