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ACCT - You have prepared the following inter-bank transfer schedule for ABC

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Question;1. Review the following information.You have prepared the following inter-bank transfer schedule for ABC.TransferCheck AmountDisbursed recorded in booksDate recorded by bankReceipt recorded in booksDate recorded by banks1$5,00012/31/131/4/1412/31/1312/31/132$10,0001/4/141/5/1412/31/131/3/143$150,00012/31/131/5/1412/31/131/4/144$30,0001/4/1412/31/1312/13/141/4/14What is the effect of the above on cash in bank account, ie. Discuss.2. Provide one piece of documentation that is relevant (to cash) that provides evidence for each of the following assertions.a. Presentation and disclosureb. Rights and obligationsc. Existence and occurrenced. Completion and cutoffe. ValuationA/R Substantive Testing:1. Assume the two scenarios:a. You evaluate accounts receivable internal controls and conclude the IC risk as being low. Also, you have estimated inherent risk as low. The total balance in AR is relatively low.b. You evaluate account receivable internal controls and conclude the IC risk as being at the maximum and inherent risk is moderate. The total balance in AR is very material.Required: Create two separate audit programs, one for scenario a, and one for scenario b.2. The in-charge auditor has calculated, using PPS, that a sample of 117 accounts receivable invoices should be selected to help determine the accuracy of the AR balance. The invoices were selected and confirmations were sent. The following issues were uncovered. What is your response to each of the issues?a. Confirmation #34 was not returned.b. Confirmation #21 was sent back with a comment from the customer saying the amount was paid in January.c. Confirmation #74 was retuned with a comment that the amount is too high due to a returned shipment by the customer.d. Confirmation #82 was returned to your client.f. Confirmation #98 was returned with a comment stating that the customer only keeps books as a total balance not individual invoices.Inventory Substantive Testing:1. Provide one piece of documentation that provides evidence for each of the following assertions, for inventory substantive testing.a. Presentations and disclosureb. Rights and obligationsc. Existence and occurrenced. Completion and cutoffe. ValuationLong-Term Assets Substantive Testing:1. Provide one piece of documentation that provides evidence for each of the following assertions, for long-term assets substantive testing.a. Presentations and disclosureb. Rights and obligationsc. Existence and occurrenced. Completion and cutoffe. ValuationLong-Term Liabilities Substantive Testing:1. Provide three other accounts that are indirectly audited when you audit long-term liabilities.Completing the Audit:1. What are the procedures you would perform near or at the end of the audit? Note that one or more of these procedures may also have been performed during the audit.2. What are you responsibilities regarding subsequent events? What procedures would you perform?Writing the report:1. Write the audit report based on your audit findings. Justify your choice of opinion.

 

Paper#38392 | Written in 18-Jul-2015

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