When conducting an audit, one must develop a concrete understanding of a business and the type of environment the business operates in. The auditor must examine all the elements that make up the business and that also must include an understanding of the company’s internal controls. Once the auditor has a genuine understanding of the business; the auditor will establish material information, and create a series of procedures for the audit. In the instance of Apollo Shoes, an audit was conducted on the financial reports, the sales and collection cycle, and the payroll and personnel cycle. The final step of an audit design program would be to audit Apollo Shoes’ inventory and warehousing cycle and the cash cycle.
RCV Auditing firm will conduct part III of the audit of Apollo Shoes and will focus on two areas of concern, those being Inventory and warehousing cycle and Cash cycle. Within the scope of our audit we will review such items as receiving of materials, storage, purchase orders, shipping of orders. We will also review the company’s cash cycle such as receiving payments, cash posting, bank reconciliations and verification. Inventory and Warehousing Cycle There are several steps in the inventory and warehousing cycle of Apollo Shoes that will be reviewed for accuracy and completeness of policies and procedures in place. The first area that will be reviewed will be test of controls within the inventory and warehousing cycle such as: Inventory
Audit procedures provide overall substantiation to obtain relevant and reliable evidence and in most cases produce influential evidence that such misstatements are intentional. In the case of Apollo Shoes, Inc., presented in this audit design program, the auditor will also be required to have adequate industry knowledge and have researched Apollo’s environment. During the audit, Apollo’s internal controls will also be assessed with immense consideration. Audit Program Design: Apollo Shoes, Inc. Inventory and warehouse cycle Inventory accounts for a large portion of a company’s assets and is one of the more significant accounts presented on the financial statement.
However, we, as in AOW offer a couple of other types of audits, which is an operational audit, and a compliance audit. An operational audit evaluates all of the operating procedures for efficiency, and can include more than just accounting. The evaluation can include the organizational structure, computer operations, production methods, marketing, and any other area. A compliance audit can be helpful for staying in compliance with the Department of Labor by examining wage rates with wage laws among other areas. The financial statement audit is the one I will be concentrating on by examining the financials to be sure Apollo Shoes in compliance with the required US accounting standards.
Audit Program Design Part III Nina Benham ACC546 Professor Deborah Fitzgerald Thomas August 4, 2014 Introduction In order to perform an extensive audit of Apollo Shoes, any auditor would need to acquire a sufficient comprehension of the business and the business’s situation, including the internal control. An understanding of the business and its situation helps auditors in a variety of ways throughout the audit, including establishing materiality, considering the appropriateness, and creating audit procedures that can facilitate the growth of Apollo Shoes. Before an auditor can begin the process of conducting the “audit of the inventory and warehousing cycle and cash
Mr. Larry Lancaster, Chairman, President and CEO DATE Apollo Shoes Shoetown, Maine 11223 Dear Mr. Lancaster, This letter is to confirm the arrangement for the upcoming audit of Apollo Shoes. The audit will consist of auditing the financial statements to include the income statement, balance sheets, statement of retained earnings, and the statement of cash flows. As a follow-up I’d like to highlight the services my firm offers to clients like Apollo Shoes. Harris, Harris, and Associates provide operational, financial and compliance audits for clients various needs. The operational audit studies the specific parts of an organization with the purpose of measuring its performance.
Engagement Letter Dear Mr. Lawrence, This letter is to confirm that there is a mutual understanding on the auditing process and arrangement of the financials for Apollo Shoes, Inc. We will begin the process by auditing the balance sheets for the company and any statements of income, stockholders equity, cash flows, and comprehensive income that is related for use to express an opinion. We will also include in the auditing process the internal controls over financial statements and whether they were properly maintained based on established criteria in Internal Control- Integrated of Sponsoring Organizations of the Treadway Commission (COSO criteria). The financial records and information that are made available for the audit are also the responsibility of Apollo Shoes, Inc. as is the management of
Apollo, Inc. management of their financial records and accounting system and the auditor will accumulate evidence based on the information gather on the company’s financial records and accounting systems. Apollo Shoes, Inc.’s management is responsible for these financial records and other related information available for audit and for identifying and ensuring that the company complies with the laws and regulations that apply to its activities. Lastly, management is responsible for adjusting the financial statements to correct material misstatements and for affirming to us in the representation letter that the effects of any uncorrected misstatements aggregated by us during the current engagement and pertaining to the latest period presented are immaterial, both individually and in the aggregate, to the financial statements taken as a whole (North Carolina State Board of CPA Examiners, 2009). Our responsibility is to express an opinion on these financial statements and an opinion on the effectiveness of the company’s internal control
Assessment Questions Q.1. a) List the relevant legislative acts and regulatory requirements which affect the business operation of your organisation. OHS Act, Fair Work Act, Competition and Consumer Act, Privacy Act. b) How would you inform your work team of the legislation? Print out hard copy of legislation and place on walls.
Unit 4222-264 the Principles of Infection Prevention and Control Outcome 1 1.1 As an employee it is our responsibility to adhere to company policies and procedures as well as those implemented by localised procedures. This means any communicable diseases which are notifiable, must be brought to the attention of the appropriate authority if I have any concerns what so ever regarding the management of infectious diseases in the workplace, I should record and contact line manager, who will seek professional advice. All employees must also observe general Precautions, other rules specific to a particular work activity must also be observed. Preventing infection Employees can help by: Washing hands when appropriate Keeping equipment clean Remaining vigilant and reporting potential hazards Attending infection control training and keeping updated Wearing Personal Protective Equipment Maintaining personal hygiene Disposing of waste correctly 1.2 Employers have a duty of care to all employees under the health and safety legislation, which gives the employers the responsibility to protect employees from danger and harm, as far as possible. Employers must provide a safe work place Carry out risk assessments to assess the dangers of certain work activities Provide training for all staff Provide personal protective equipment Ensure regular health and safety checks are undertaken Employer’s responsibilities extend to protecting employees from the risk posed by biological hazards such as blood, body fluids and associated infections.