Control Activities – NBC Institute

AAA – Nov 2021 – L3 – Q7 – Audit of IT Systems and Data Analytics

Discuss control environment requirements of ISA 315 and evaluate control activities for Egunje Distributors Ltd.

Question

Egunje Distributors Limited is a private company in which Chief Idowu is the major shareholder. Chief Idowu set up the business to help provide resources for his philanthropic gestures. He has been involved in the major control activities, and the business was achieving its purpose, and things were working well.

After a number of years, Chief Idowu stepped aside from the business and handed over effective management to one of his subordinates, whom he elevated to the rank of General Manager (GM). The GM followed Chief Idowu’s control processes for only one year and then introduced new ideas and processes, resulting in undue amounts being transferred into his private accounts rather than the company’s accounts. This has affected the results of the company.

While Chief Idowu has not decided to take any hasty action, he has decided to bring in your firm, due to its size, so that through your work, he may understand the reasons for the dwindling performance. It has been discussed and agreed that your report on the audit will provide insight into the reasons for the observed decline in performance.

Required:

a. Discuss the control environment, focusing on the requirements of ISA 315 – Identifying and assessing the risk of material misstatement through understanding the entity and its environment, that will be relevant to this situation. (9 Marks)

b. Evaluate the control activities that will require your attention. (6 Marks)

Answer

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Tags: Audit Planning, Control Activities, Control Environment, Internal Controls, ISA 315, Risk of Misstatement
Level: Level 3

Topic: Audit of IT Systems and Data Analytics

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

Question

Control activities may be defined as policies, procedures, and operations that help to enable management directives to be carried out. These activities are detailed procedures designed to prevent, or to detect and correct errors that may arise in processing information.

Required:

a. Set out the five types of control activities and illustrate each one in the context of purchases or trade payables system. (10 Marks)

b. Explain why, even where tests of controls prove satisfactory, substantive procedures can never be completely eliminated. (5 Marks)

Answer

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Tags: Control Activities, Internal Controls, Purchases System, Substantive Procedures, Trade Payables
Level: Level 2

Topic: Internal Control Systems
Series: MAY 2016

AA – Nov 2016 – L2 – Q3b – Internal Control Systems

This question explains four categories of control activities, focusing on their roles in ensuring effective internal control within an organization.

Question

State and explain FOUR categories of control activities.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Control Activities, Information Processing Controls, Performance Reviews, Physical Controls, Segregation of Duties
Level: Level 2

Topic: Internal Control Systems
Series: NOV 2016

AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd

List control objectives and activities for cash sales and bank lodgments.

Question

List TWO control objectives and THREE control activities that should be put in place for each of the following:
i. Cash sales. (5 Marks)
ii. Lodgments into bank. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Bank Lodgments, Cash Sales, Control Activities, Control Objectives, Internal Control
Level: Level 2

Topic: Internal Control Systems
Series: MAR/JULY 2020

AA – May 2019 – L2 – Q2 – Planning an Audit

Examination of benefits and procedures related to interim and final audits, including risk assessment considerations.

Question

Most large audits would be split into two phases. The systems assessment work and transaction testing are carried out during interim audit which takes place close to the end of the year. The balance of the work and testing of items of the statement of financial position takes place at the final audit shortly after the year-end. You are required to:

a. Identify FOUR key benefits that may arise from spreading the audit work across interim audit and final audit. (2 Marks)
b. Explain THREE audit procedures that would be carried out during the interim audit and FIVE of the audit procedures that can be carried out during the final audit. (8 Marks)
c. ISA 300 specifically states that some procedures can only be performed at or after the year-end. Identify TWO of these procedures. (2 Marks)
d. An auditor is required by ISA 315 to identify and assess the risks of material misstatement at both the financial statement and assertion levels. Explain FOUR of the issues to be considered by the auditor on risk assessment at the planning stage of the audit. (4 Marks)
e. Compare systems based audit approach with substantive approach. (4 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit Risk, Control Activities, Control Environment, Internal Control, Risk Assessment
Level: Level 2

Topic: Planning an Audit
Series: MAY 2019

AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery

This question addresses weaknesses in internal control systems, control objectives, and activities for cash sales and bank lodgements.

Question

In a medium-sized trading organisation, the accountant was given the additional responsibility of pursuing recoveries from debtors. On one occasion, when an insurance claim of N1 million was received, the accountant credited it to the account of a debtor to cover up a previous misappropriation of N1 million he had recovered in cash from the debtor.

Required:
(a) Identify and describe the weaknesses in the internal control system which led to this situation. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Bank Lodgements, Cash Sales, Control Activities, Control Objectives, Internal Control, Weaknesses
Level: Level 2

Topic: Internal Control Systems
Series: MAR/JULY 2020

AAA – Nov 2021 – L3 – Q7 – Audit of IT Systems and Data Analytics

Discuss control environment requirements of ISA 315 and evaluate control activities for Egunje Distributors Ltd.

Question

Required:

b. Evaluate the control activities that will require your attention. (6 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit Planning, Control Activities, Control Environment, Internal Controls, ISA 315, Risk of Misstatement
Level: Level 3

Topic: Audit of IT Systems and Data Analytics

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

Question

Required:

a. Set out the five types of control activities and illustrate each one in the context of purchases or trade payables system. (10 Marks)

b. Explain why, even where tests of controls prove satisfactory, substantive procedures can never be completely eliminated. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Control Activities, Internal Controls, Purchases System, Substantive Procedures, Trade Payables
Level: Level 2

Topic: Internal Control Systems
Series: MAY 2016

AA – Nov 2016 – L2 – Q3b – Internal Control Systems

This question explains four categories of control activities, focusing on their roles in ensuring effective internal control within an organization.

Question

State and explain FOUR categories of control activities.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Control Activities, Information Processing Controls, Performance Reviews, Physical Controls, Segregation of Duties
Level: Level 2

Topic: Internal Control Systems
Series: NOV 2016

AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd

List control objectives and activities for cash sales and bank lodgments.

Question

List TWO control objectives and THREE control activities that should be put in place for each of the following:
i. Cash sales. (5 Marks)
ii. Lodgments into bank. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Bank Lodgments, Cash Sales, Control Activities, Control Objectives, Internal Control
Level: Level 2

Topic: Internal Control Systems
Series: MAR/JULY 2020

AA – May 2019 – L2 – Q2 – Planning an Audit

Examination of benefits and procedures related to interim and final audits, including risk assessment considerations.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit Risk, Control Activities, Control Environment, Internal Control, Risk Assessment
Level: Level 2

Topic: Planning an Audit
Series: MAY 2019

AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery

This question addresses weaknesses in internal control systems, control objectives, and activities for cash sales and bank lodgements.

Question

Required:
(a) Identify and describe the weaknesses in the internal control system which led to this situation. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Bank Lodgements, Cash Sales, Control Activities, Control Objectives, Internal Control, Weaknesses
Level: Level 2

Topic: Internal Control Systems
Series: MAR/JULY 2020

Question Tag: Control Activities

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AAA – Nov 2021 – L3 – Q7 – Audit of IT Systems and Data Analytics

Discuss control environment requirements of ISA 315 and evaluate control activities for Egunje Distributors Ltd.

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

AA – Nov 2016 – L2 – Q3b – Internal Control Systems

This question explains four categories of control activities, focusing on their roles in ensuring effective internal control within an organization.

AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd

List control objectives and activities for cash sales and bank lodgments.

AA – May 2019 – L2 – Q2 – Planning an Audit

Examination of benefits and procedures related to interim and final audits, including risk assessment considerations.

AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery

This question addresses weaknesses in internal control systems, control objectives, and activities for cash sales and bank lodgements.

AAA – Nov 2021 – L3 – Q7 – Audit of IT Systems and Data Analytics

Discuss control environment requirements of ISA 315 and evaluate control activities for Egunje Distributors Ltd.

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

AA – Nov 2016 – L2 – Q3b – Internal Control Systems

This question explains four categories of control activities, focusing on their roles in ensuring effective internal control within an organization.

AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd

List control objectives and activities for cash sales and bank lodgments.

AA – May 2019 – L2 – Q2 – Planning an Audit

Examination of benefits and procedures related to interim and final audits, including risk assessment considerations.

AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery

This question addresses weaknesses in internal control systems, control objectives, and activities for cash sales and bank lodgements.

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AAA – Nov 2021 – L3 – Q7 – Audit of IT Systems and Data Analytics

Discuss control environment requirements of ISA 315 and evaluate control activities for Egunje Distributors Ltd.

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AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

You're reporting an error for "AA – May 2016 – L2 – Q6 – Internal Control Systems"

AA – Nov 2016 – L2 – Q3b – Internal Control Systems

This question explains four categories of control activities, focusing on their roles in ensuring effective internal control within an organization.

You're reporting an error for "AA – Nov 2016 – L2 – Q3b – Internal Control Systems"

AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd

List control objectives and activities for cash sales and bank lodgments.

You're reporting an error for "AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd"

AA – May 2019 – L2 – Q2 – Planning an Audit

Examination of benefits and procedures related to interim and final audits, including risk assessment considerations.

You're reporting an error for "AA – May 2019 – L2 – Q2 – Planning an Audit"

AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery

This question addresses weaknesses in internal control systems, control objectives, and activities for cash sales and bank lodgements.

You're reporting an error for "AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery"

AAA – Nov 2021 – L3 – Q7 – Audit of IT Systems and Data Analytics

Discuss control environment requirements of ISA 315 and evaluate control activities for Egunje Distributors Ltd.

You're reporting an error for "AAA – Nov 2021 – L3 – Q7 – Audit of IT Systems and Data Analytics"

AA – May 2016 – L2 – Q6 – Internal Control Systems

Identify control activities in a trade payables system and the need for substantive procedures.

You're reporting an error for "AA – May 2016 – L2 – Q6 – Internal Control Systems"

AA – Nov 2016 – L2 – Q3b – Internal Control Systems

This question explains four categories of control activities, focusing on their roles in ensuring effective internal control within an organization.

You're reporting an error for "AA – Nov 2016 – L2 – Q3b – Internal Control Systems"

AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd

List control objectives and activities for cash sales and bank lodgments.

You're reporting an error for "AA – Mar/July 2020 – L2 – Q5 – Assurance Services and Due Diligence for Hallmark Ltd"

AA – May 2019 – L2 – Q2 – Planning an Audit

Examination of benefits and procedures related to interim and final audits, including risk assessment considerations.

You're reporting an error for "AA – May 2019 – L2 – Q2 – Planning an Audit"

AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery

This question addresses weaknesses in internal control systems, control objectives, and activities for cash sales and bank lodgements.

You're reporting an error for "AA – Mar/Jul 2020 – L2 – Q6 – Internal Control Weaknesses in Debtors’ Recovery"

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