Deficiency – NBC Institute

AA – Dec 2022 – L2 – Q5e – Audit and Assurance Risk Environment

Lists four factors an auditor may consider when determining whether deficiencies in internal control are significant.

Question

The significance of a deficiency or a combination of deficiencies in internal control depends not only on whether a misstatement has actually occurred, but also on the likelihood that a misstatement could occur and the potential magnitude of the misstatement. Significant deficiencies may therefore exist even though the auditor has not identified misstatements during the audit.

Required:
State FOUR (4) matters that an Auditor may consider in determining whether a deficiency or combination of deficiencies in internal control constitutes a significant deficiency.

Answer

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Tags: Auditor's Role, Corporate Governance, Deficiency, Internal Control, Risk Assessment
Level: Level 2

Topic: Audit and Assurance Risk Environment
Series: DEC 2022

AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence

Prepare a report to management on the deficiencies in the payroll internal control system and provide recommendations.

Question

a) Broni & Co. have audited the annual financial statements of Bibini Co. Ltd., a public limited liability company, for the year ended 31st December 2014. The accounting system of the company is partially computerized.

During the audit, it was detected that just two members of staff out of one hundred and fifty workers were entirely and equally responsible for the maintenance of personnel records and preparation of the payroll. The chief accountant only confirms that the amount of the wages and salaries cheque agrees with the total of the net wages column in the payroll, then he signs without any reasonableness check of the amount of the total wages cheque. This situation is a serious deficiency in the control system which can have serious implications. As audit senior, you are considering communicating this situation to management, showing the deficiency, implications, and recommendations.

Required:
Prepare an appropriate report to management on the deficiency noted in the internal control system for payroll. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Deficiency, Internal Control, Management Report, Payroll System, Recommendations
Level: Level 3

Topic: Audit evidence, Internal audit and outsourcing
Series: MAY 2016

AA – Dec 2022 – L2 – Q5e – Audit and Assurance Risk Environment

Lists four factors an auditor may consider when determining whether deficiencies in internal control are significant.

Question

Required:
State FOUR (4) matters that an Auditor may consider in determining whether a deficiency or combination of deficiencies in internal control constitutes a significant deficiency.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Auditor's Role, Corporate Governance, Deficiency, Internal Control, Risk Assessment
Level: Level 2

Topic: Audit and Assurance Risk Environment
Series: DEC 2022

AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence

Prepare a report to management on the deficiencies in the payroll internal control system and provide recommendations.

Question

Required:
Prepare an appropriate report to management on the deficiency noted in the internal control system for payroll. (10 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Deficiency, Internal Control, Management Report, Payroll System, Recommendations
Level: Level 3

Topic: Audit evidence, Internal audit and outsourcing
Series: MAY 2016

Question Tag: Deficiency

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AA – Dec 2022 – L2 – Q5e – Audit and Assurance Risk Environment

Lists four factors an auditor may consider when determining whether deficiencies in internal control are significant.

AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence

Prepare a report to management on the deficiencies in the payroll internal control system and provide recommendations.

AA – Dec 2022 – L2 – Q5e – Audit and Assurance Risk Environment

Lists four factors an auditor may consider when determining whether deficiencies in internal control are significant.

AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence

Prepare a report to management on the deficiencies in the payroll internal control system and provide recommendations.

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AA – Dec 2022 – L2 – Q5e – Audit and Assurance Risk Environment

Lists four factors an auditor may consider when determining whether deficiencies in internal control are significant.

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AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence

Prepare a report to management on the deficiencies in the payroll internal control system and provide recommendations.

You're reporting an error for "AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence"

AA – Dec 2022 – L2 – Q5e – Audit and Assurance Risk Environment

Lists four factors an auditor may consider when determining whether deficiencies in internal control are significant.

You're reporting an error for "AA – Dec 2022 – L2 – Q5e – Audit and Assurance Risk Environment"

AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence

Prepare a report to management on the deficiencies in the payroll internal control system and provide recommendations.

You're reporting an error for "AAA – May 2016 – L3 – Q5a – Internal audit and outsourcing | Audit evidence"

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