Audit sample performing of the balance of revenue...
giving materiality £500, £3,500 of revenue recorded. If the prior year audit noticed £3,300 to be fairly stated; total of 15 exceptions in the prior year - 2 of A, 8 of C, 4 of D, 1 of G. Its been determined that the No of exceptions for each assertion was acceptable and below the tolerable exception rate.
A-a double-recorded transaction,
B-a sale with a non-existent customer
C-sale recorded at an incorrect selling price
D-sale recorded at an incorrect quantity
E-sale recorded in the wrong period
F-sale recorded at the wrong price and quantity
G-sale does not have a corresponding shipment
H-sales amount does not agree to recorded AR amount
- What are the assertions each type id error violates?
- During sample planning stage what would be determined as audit objective?
- What population and sampling unit should be defined (not sure, "population of sales invoices in the sales journal"?)
- What is the attribute and assertion I should test for and what would constitute and exception?
- How can I set TER and ARO and how can I determine how many exceptions can occur before i can conclude the account misstated? Should I set different TER for different assertions?
- What in this case would be EPER ? and like with TER do i have different deviation rates for different assertions/attributes?
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