AC410 Unit 9 Homework Assignment

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AC410 Unit 9 Homework Assignment

18–29. The CPA firm of Carson & Boggs LLP is performing an internal control audit in accordance with PCAOB Standard No. 5. The partner in charge of the engagement has asked you to explain the process of determining which controls to test. Describe the process, presenting each of the links in this process and a short summary of how the auditors approach each of them.

18–34. Simulation

Bill Jensen, a staff member of Zhan & Co., CPAs, has given you the following list of what he refers to as “internal control deficiencies” for the Zabling Co. audit and has asked you to review each point and make certain that you agree that each is an internal control deficiency. For each of the following items, reply A (Agree) or D (Disagree) indicating whether the item represents an internal control deficiency.

18–35. Match the following definitions (or partial definitions) to the appropriate term. Each term may be used once or not at all.

18–36. Your working papers for an integrated audit being performed under PCAOB Standard No. 5 include the narrative description below of the cash receipts and billing portions of internal control of Slingsdale Building Supplies, Inc. Slingsdale is a single-store retailer that sells a variety of tools, garden supplies, lumber, small appliances, and electrical fixtures to the public, although about half of Slingsdale’s sales are to construction contractors on account. Slingsdale employs 12 salaried sales associates, a credit manager, three full-time clerical workers, and several part-time cash register clerks and assistant bookkeepers. The full-time clerical workers perform such tasks as cash receipts, billing, and accounting and are adequately bonded. They are referred to in the narrative as “accounts receivable supervisor,” “cashier,” and “bookkeeper.”

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