Audit and Internal Control Issues

Audit and Internal Control Issues Coursework example
High school
Coursework
Finance & Accounting
Pages 6 (1506 words)
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Report To: Jean-Pierre Christophe CEO, SUCRE DELIGHTS LTD From: Manager Date: 23 May 2012 Subject: Audit and Internal Control Issues - Sucre Delights Limited Keeping in view the weaknesses in the internal control and management practices in relation to maintaining effective internal control, different areas of concerns are discussed in this report…

Introduction

In the next section, the report identifies the tests of controls to be performed for obtaining sufficient appropriate audit evidence in relation to purchases made during a year. Lastly, the report discusses the substantive procedures, which are to be carried out for the purpose of obtaining reasonable assurance as to the reliability and correctness of the information pertaining to inventory in the financial statements of the company. A. Key Business Risks, Possible Consequences and Risk Mitigating Strategies Since the company is going through a declining phase as far as profitability and sales turnover is concerned, it is pertinent to consider areas which require management’s attention. The increase in the employee turnover rate and the fact that there are few experienced professionals left in the accounts department of the company pose significant risks in relation to the operations of the company and the preparation and presentation of financial statements which are free from material misstatements. Apart from this, the increase in competitors of the business also poses a significant threat in future. All these risks can act together to result in a risk related to going concern of the business. ...
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