Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
The firm you work for has considered the growing development in some sectors of the economy and the opportunities this development portends.
Your firm is a sole practitioner, and though the partner has the skills and professional competences necessary to undertake big jobs, applications for big jobs have always been turned down.
To get involved and secure some of these big jobs, your partner has dialogued with some other sole practitioners who share the same view. They have agreed to operate a merged firm starting in the year 2022. Appropriate registration of the new practice name with the Corporate Affairs Commission and application for a license in the new name from the Institute are being processed. To prepare for securing and executing some of these big jobs, preparations are set to commence once the registrations are approved. Some of the target jobs involve computerised entities, so your partner has assigned you some preparatory tasks, as he is the lead partner.
Required:
a. Prepare a document showing the application controls that will be focused on in the computerised systems of the entities. (7 Marks)
b. Develop an appropriate audit strategy in accordance with ISA 300, “Planning an audit of financial statements.” (8 Marks)
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You have been appointed as the auditor of a company that processes its accounting functions using a computer system. You have decided to use computer-assisted audit techniques (CAATs) to generate necessary audit evidence for this engagement.
Required:
i. Discuss the activities members of the audit team could perform with their computers in the client’s office. (4 Marks)
ii. Analyze TWO types of audit software in use in computer-based information systems. (4 Marks)
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The availability of Computer Assisted Audit Techniques (CAATs) should be considered by the Auditor when planning the nature, extent, and timing of tests in an audit. Hence, the auditor must determine their testing strategies, which will depend on their decision of either using a Manual Testing method or CAATs method, to avoid loss of audit trail.
Required:
i. Discuss FIVE solutions to loss of audit trail. (5 Marks)
ii. Evaluate the merits and demerits of the application of CAATs. (7 Marks)
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The method most appropriate for a company to change from a manual-based system to a computer-based accounting system is:
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A new hotel opened for operations on February 1, 2016, in Abuja. The directors at their board meeting in September 2016 selected December as the hotel’s year-end. Also, from the conception of the hotel, it was decided to fully computerize the hotel and its operations. This will make the hotel stand out and attract clientele in the federal capital territory where there are many other hotels with strong competition.
The room doors are electronically operated and use electronic cards for opening. If a customer does not specify his/her duration and has the lock properly programmed, the door will lock at 12 noon, requiring the customer to go back to the reception for access. Furthermore, all accounting and other processes are computerized.
The IT company that handled the computerization agreed to leave a member of staff who will train the hotel’s staff for three months and ensure that the system operates efficiently. Management believes that the staff will familiarize themselves with the system within that period. The server handles all doors, accounting processes including billing, and the determination of room occupancy rate on a daily basis. Various units of the hotel have desktop units which key employees use in both ordering and communication between themselves. The server is located next to the operations manager’s office, who is responsible for overseeing it in addition to other duties.
The last quarterly report on the hotel activities was not consistent with expectations, and the occupancy rate did not match turnover. The management of the hotel approached your firm of chartered accountants to be engaged as auditors to the hotel. Your review and interactions as the leader of the audit team revealed the information disclosed above.
Required:
Evaluate and apply the relevant general and application controls necessary to be installed in the hotel’s information environment.
(Total 20 Marks)
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Hypermart Plc operates Electronics Data Interchange (EDI) system for the transmission of business documents.
Required:
Analyse the problems the EDI system may create for the auditor and what controls are expected to be in place to minimise the risks in the EDI system.
Find Related Questions by Tags, levels, etc.
Computer-Assisted Audit Techniques (CAATs) is a growing field within the IT audit profession. CAATs is the practice of using computers to automate the IT audit processes.
Required:
Explain THREE (3) relevance of CAATs in evaluating audit evidence.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
The firm you work for has considered the growing development in some sectors of the economy and the opportunities this development portends.
Your firm is a sole practitioner, and though the partner has the skills and professional competences necessary to undertake big jobs, applications for big jobs have always been turned down.
To get involved and secure some of these big jobs, your partner has dialogued with some other sole practitioners who share the same view. They have agreed to operate a merged firm starting in the year 2022. Appropriate registration of the new practice name with the Corporate Affairs Commission and application for a license in the new name from the Institute are being processed. To prepare for securing and executing some of these big jobs, preparations are set to commence once the registrations are approved. Some of the target jobs involve computerised entities, so your partner has assigned you some preparatory tasks, as he is the lead partner.
Required:
a. Prepare a document showing the application controls that will be focused on in the computerised systems of the entities. (7 Marks)
b. Develop an appropriate audit strategy in accordance with ISA 300, “Planning an audit of financial statements.” (8 Marks)
Find Related Questions by Tags, levels, etc.
You have been appointed as the auditor of a company that processes its accounting functions using a computer system. You have decided to use computer-assisted audit techniques (CAATs) to generate necessary audit evidence for this engagement.
Required:
i. Discuss the activities members of the audit team could perform with their computers in the client’s office. (4 Marks)
ii. Analyze TWO types of audit software in use in computer-based information systems. (4 Marks)
Find Related Questions by Tags, levels, etc.
The availability of Computer Assisted Audit Techniques (CAATs) should be considered by the Auditor when planning the nature, extent, and timing of tests in an audit. Hence, the auditor must determine their testing strategies, which will depend on their decision of either using a Manual Testing method or CAATs method, to avoid loss of audit trail.
Required:
i. Discuss FIVE solutions to loss of audit trail. (5 Marks)
ii. Evaluate the merits and demerits of the application of CAATs. (7 Marks)
Find Related Questions by Tags, levels, etc.
The method most appropriate for a company to change from a manual-based system to a computer-based accounting system is:
Find Related Questions by Tags, levels, etc.
A new hotel opened for operations on February 1, 2016, in Abuja. The directors at their board meeting in September 2016 selected December as the hotel’s year-end. Also, from the conception of the hotel, it was decided to fully computerize the hotel and its operations. This will make the hotel stand out and attract clientele in the federal capital territory where there are many other hotels with strong competition.
The room doors are electronically operated and use electronic cards for opening. If a customer does not specify his/her duration and has the lock properly programmed, the door will lock at 12 noon, requiring the customer to go back to the reception for access. Furthermore, all accounting and other processes are computerized.
The IT company that handled the computerization agreed to leave a member of staff who will train the hotel’s staff for three months and ensure that the system operates efficiently. Management believes that the staff will familiarize themselves with the system within that period. The server handles all doors, accounting processes including billing, and the determination of room occupancy rate on a daily basis. Various units of the hotel have desktop units which key employees use in both ordering and communication between themselves. The server is located next to the operations manager’s office, who is responsible for overseeing it in addition to other duties.
The last quarterly report on the hotel activities was not consistent with expectations, and the occupancy rate did not match turnover. The management of the hotel approached your firm of chartered accountants to be engaged as auditors to the hotel. Your review and interactions as the leader of the audit team revealed the information disclosed above.
Required:
Evaluate and apply the relevant general and application controls necessary to be installed in the hotel’s information environment.
(Total 20 Marks)
Find Related Questions by Tags, levels, etc.
Hypermart Plc operates Electronics Data Interchange (EDI) system for the transmission of business documents.
Required:
Analyse the problems the EDI system may create for the auditor and what controls are expected to be in place to minimise the risks in the EDI system.
Find Related Questions by Tags, levels, etc.
Computer-Assisted Audit Techniques (CAATs) is a growing field within the IT audit profession. CAATs is the practice of using computers to automate the IT audit processes.
Required:
Explain THREE (3) relevance of CAATs in evaluating audit evidence.
Find Related Questions by Tags, levels, etc.
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