Question Tag: Control Environment

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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.

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

CSME – Nov 2023 – L2 – Q4 – Ethics in Business

Discuss the relationship models between accountants and clients, recommending the most suitable and least suitable models.

Question

There are different models of relationship between a professional accountant and his/her clients. In the context of the above:

a. Explain the different models of relationship between a professional accountant and his/her clients. (16 Marks)

b. Which of the models in (a) above would you recommend, and which do you consider to be the least recommended? (Provide justification for your choices) (4 Marks)

Answer

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Tags: Audit Approach, Client Relationships, Control Environment, Inherent Risk, Nonprofit risk management, Professional Ethics
Level: Level 2

Topic: Ethics in Business

AA – Nov 2023 – L2 – Q4 – Audit of Public Sector Entities

Identify inherent risks in a non-profit organization and assess control environment weaknesses impacting audit approach.

Question

Greater Tomorrow Foundation (GTF) was established with the aim of providing support to children from disadvantaged backgrounds who wish to participate in sports, such as tennis, athletics, and football. It has benefited the country, with some beneficiaries representing the nation in international competitions.

GTF has a constitution detailing how income can be spent and limits administrative expenditure to one-eighth of its income annually.

GTF’s income comes solely from voluntary donations, including:

Cash collected by volunteers from the public.
Direct donations from generous individuals.

Certain donations specify that the principal amount cannot be spent, with income generated (interest) allocated to specific activities, like providing sports equipment (e.g., footballs, boots, rackets, sportswear, etc.).

Required:

a. Explain FIVE areas of inherent risk in Greater Tomorrow Foundation (GTF) and explain the effect of each risk on the audit approach. (10 Marks)

b. Explain FIVE reasons why the control environment may be weak in GTF. (10 Marks)

Answer

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Tags: Audit Approach, Compliance, Control Environment, Donations, Financial Controls, Inherent Risk, Non-profit
Level: Level 2

Topic: Audit of Public Sector Entities

AA – Nov 2015 – L2 – Q1a – Internal Control Systems

Explanation of internal control, its objectives, and the components that support it.

Question

Knowledge of internal control is a very basic audit skill. While auditors are not responsible for the institution of internal controls, they are responsible for providing management with information about how internal control is operating.

Required:
i. Illustrate what internal control is. (4 Marks)
ii. Describe THREE categories of internal control objectives. (6 Marks)
iii. Describe FIVE components of Internal control. (5 Marks)

Answer

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Tags: Auditing, Control Environment, Control Objectives, Internal Control, Risk Management
Level: Level 2

Topic: Internal Control Systems
Series: NOV 2015

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

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

Topic: Planning an Audit
Series: MAY 2019

AA – Nov 2018 – L2 – Q1a – Internal Control Systems

Explain control environment and control procedures and discuss the five elements of internal control as per ISA 315.

Question

Auditors are required by International Standards on Auditing (ISA) to understand and assess a client’s system of internal control. Consequently, auditors must use their judgment to determine whether to test all or part of the internal control system as part of their response to the assessed risk of material misstatement in the financial statements to be audited.

Required:
i. Explain the following terms:

Control environment
Control procedures
(5 Marks)

ii. State and explain the five elements of internal control as identified by ISA 315.
(5 Marks)

Answer

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Tags: Control Environment, Control Procedures, Internal Control, ISA 315, Risk Assessment
Level: Level 2

Topic: Internal Control Systems
Series: NOV 2018

AA – Mar 2023 – L2 – Q5a – Audit and Assurance Risk Environment

Identify and explain the components of an entity’s internal control system.

Question

ISA 315 (Revised): Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment requires auditors to understand the entity’s internal control. An entity’s internal control is made up of several components.

Required:
In reference to the statement above, state the FIVE (5) components of an entity’s internal control and give a brief explanation of each component.

Answer

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Tags: Control Environment, Entity’s Risk Assessment, Internal Control, ISA 315
Level: Level 2

Topic: Audit and Assurance Risk Environment
Series: MAR 2023

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

CSME – Nov 2023 – L2 – Q4 – Ethics in Business

Discuss the relationship models between accountants and clients, recommending the most suitable and least suitable models.

Question

There are different models of relationship between a professional accountant and his/her clients. In the context of the above:

a. Explain the different models of relationship between a professional accountant and his/her clients. (16 Marks)

b. Which of the models in (a) above would you recommend, and which do you consider to be the least recommended? (Provide justification for your choices) (4 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit Approach, Client Relationships, Control Environment, Inherent Risk, Nonprofit risk management, Professional Ethics
Level: Level 2

Topic: Ethics in Business

AA – Nov 2023 – L2 – Q4 – Audit of Public Sector Entities

Identify inherent risks in a non-profit organization and assess control environment weaknesses impacting audit approach.

Question

GTF has a constitution detailing how income can be spent and limits administrative expenditure to one-eighth of its income annually.

GTF’s income comes solely from voluntary donations, including:

Cash collected by volunteers from the public.
Direct donations from generous individuals.

Required:

a. Explain FIVE areas of inherent risk in Greater Tomorrow Foundation (GTF) and explain the effect of each risk on the audit approach. (10 Marks)

b. Explain FIVE reasons why the control environment may be weak in GTF. (10 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Audit Approach, Compliance, Control Environment, Donations, Financial Controls, Inherent Risk, Non-profit
Level: Level 2

Topic: Audit of Public Sector Entities

AA – Nov 2015 – L2 – Q1a – Internal Control Systems

Explanation of internal control, its objectives, and the components that support it.

Question

Required:
i. Illustrate what internal control is. (4 Marks)
ii. Describe THREE categories of internal control objectives. (6 Marks)
iii. Describe FIVE components of Internal control. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Auditing, Control Environment, Control Objectives, Internal Control, Risk Management
Level: Level 2

Topic: Internal Control Systems
Series: NOV 2015

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 – Nov 2018 – L2 – Q1a – Internal Control Systems

Explain control environment and control procedures and discuss the five elements of internal control as per ISA 315.

Question

Required:
i. Explain the following terms:

Control environment
Control procedures
(5 Marks)

ii. State and explain the five elements of internal control as identified by ISA 315.
(5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Control Environment, Control Procedures, Internal Control, ISA 315, Risk Assessment
Level: Level 2

Topic: Internal Control Systems
Series: NOV 2018

AA – Mar 2023 – L2 – Q5a – Audit and Assurance Risk Environment

Identify and explain the components of an entity’s internal control system.

Question

Required:
In reference to the statement above, state the FIVE (5) components of an entity’s internal control and give a brief explanation of each component.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Control Environment, Entity’s Risk Assessment, Internal Control, ISA 315
Level: Level 2

Topic: Audit and Assurance Risk Environment
Series: MAR 2023

Question Tag: Control Environment

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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.

CSME – Nov 2023 – L2 – Q4 – Ethics in Business

Discuss the relationship models between accountants and clients, recommending the most suitable and least suitable models.

AA – Nov 2023 – L2 – Q4 – Audit of Public Sector Entities

Identify inherent risks in a non-profit organization and assess control environment weaknesses impacting audit approach.

AA – Nov 2015 – L2 – Q1a – Internal Control Systems

Explanation of internal control, its objectives, and the components that support it.

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

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

AA – Nov 2018 – L2 – Q1a – Internal Control Systems

Explain control environment and control procedures and discuss the five elements of internal control as per ISA 315.

AA – Mar 2023 – L2 – Q5a – Audit and Assurance Risk Environment

Identify and explain the components of an entity’s internal control system.

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.

CSME – Nov 2023 – L2 – Q4 – Ethics in Business

Discuss the relationship models between accountants and clients, recommending the most suitable and least suitable models.

AA – Nov 2023 – L2 – Q4 – Audit of Public Sector Entities

Identify inherent risks in a non-profit organization and assess control environment weaknesses impacting audit approach.

AA – Nov 2015 – L2 – Q1a – Internal Control Systems

Explanation of internal control, its objectives, and the components that support it.

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

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

AA – Nov 2018 – L2 – Q1a – Internal Control Systems

Explain control environment and control procedures and discuss the five elements of internal control as per ISA 315.

AA – Mar 2023 – L2 – Q5a – Audit and Assurance Risk Environment

Identify and explain the components of an entity’s internal control system.

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Question Tag: Control Environment

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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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CSME – Nov 2023 – L2 – Q4 – Ethics in Business

Discuss the relationship models between accountants and clients, recommending the most suitable and least suitable models.

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AA – Nov 2023 – L2 – Q4 – Audit of Public Sector Entities

Identify inherent risks in a non-profit organization and assess control environment weaknesses impacting audit approach.

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AA – Nov 2015 – L2 – Q1a – Internal Control Systems

Explanation of internal control, its objectives, and the components that support it.

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

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

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AA – Nov 2018 – L2 – Q1a – Internal Control Systems

Explain control environment and control procedures and discuss the five elements of internal control as per ISA 315.

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AA – Mar 2023 – L2 – Q5a – Audit and Assurance Risk Environment

Identify and explain the components of an entity’s internal control system.

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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.

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

CSME – Nov 2023 – L2 – Q4 – Ethics in Business

Discuss the relationship models between accountants and clients, recommending the most suitable and least suitable models.

You're reporting an error for "CSME – Nov 2023 – L2 – Q4 – Ethics in Business"

AA – Nov 2023 – L2 – Q4 – Audit of Public Sector Entities

Identify inherent risks in a non-profit organization and assess control environment weaknesses impacting audit approach.

You're reporting an error for "AA – Nov 2023 – L2 – Q4 – Audit of Public Sector Entities"

AA – Nov 2015 – L2 – Q1a – Internal Control Systems

Explanation of internal control, its objectives, and the components that support it.

You're reporting an error for "AA – Nov 2015 – L2 – Q1a – Internal Control Systems"

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 – Nov 2018 – L2 – Q1a – Internal Control Systems

Explain control environment and control procedures and discuss the five elements of internal control as per ISA 315.

You're reporting an error for "AA – Nov 2018 – L2 – Q1a – Internal Control Systems"

AA – Mar 2023 – L2 – Q5a – Audit and Assurance Risk Environment

Identify and explain the components of an entity’s internal control system.

You're reporting an error for "AA – Mar 2023 – L2 – Q5a – Audit and Assurance Risk Environment"

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