AUI3702 ASSIGNMENT 4 SOLUTIONS 2021 SEMESTER 1 AND 2
Contents
AUI3702 ASSIGNMENT 4 SOLUTIONS 2021 SEMESTER 1 AND 2 ....................................1
1.1 For each of the procurement risks listed above, identify and describe an internal control
activity that will mitigate these risks. (6) .........................................................................................2
1.2 Compile eight (8) audit engagement procedures that can be used to test the fairness of the
accounts receivable balance of Friedman Limited. (12) ..................................................................3
QUESTION 2 ...................................................................................................................................4
Discuss, based on the information given above, the weaknesses in the general controls at The
Chairman (Pty) Ltd. Your discussion must focus on the categories of general controls. [20] .........5
IF YOU HAVE DIFFERENT QUESTIONS FROM THE ABOVE KINDLY CHECK BELOW ON THE WRIITEN
DOC ..................................................................................................................................................8
1.1 for each of the procument risks listed above identify and describe an internal control activity
that will mitigate these risks ...........................................................................................................8
1.2 compile eight audit engagement procedures that can be used to test the fairness of the
accounts receivable balance of friedman LTD .................................................................................8
2.1 During an internal audit of Circle Limited wages , the following summarized system
description was handed over to you................................................................................................8
Identify and discuss four weaknesses in the above control system for wages ...............................8
2.2 describe three controls that will prevent unauthorized changes or additions to the
computerized standing data in the employee masterfile ................................................................8
QUESTION 1
QUESTION (18 MARKS)
Part A
Friedman Limited is a company that sells new and second-hand executive cars to the
public. The company has showrooms in Cape Town, Pretoria and Johannesburg. The Cape
Town premises has spare capacity and a large warehouse is used for the sale of various
types of spare parts and accessories to motor mechanics. These items are sold on a cash or
credit basis. According to the organisation’s discount policy, a standard rate of 2,5%
1
Contents
AUI3702 ASSIGNMENT 4 SOLUTIONS 2021 SEMESTER 1 AND 2 ....................................1
1.1 For each of the procurement risks listed above, identify and describe an internal control
activity that will mitigate these risks. (6) .........................................................................................2
1.2 Compile eight (8) audit engagement procedures that can be used to test the fairness of the
accounts receivable balance of Friedman Limited. (12) ..................................................................3
QUESTION 2 ...................................................................................................................................4
Discuss, based on the information given above, the weaknesses in the general controls at The
Chairman (Pty) Ltd. Your discussion must focus on the categories of general controls. [20] .........5
IF YOU HAVE DIFFERENT QUESTIONS FROM THE ABOVE KINDLY CHECK BELOW ON THE WRIITEN
DOC ..................................................................................................................................................8
1.1 for each of the procument risks listed above identify and describe an internal control activity
that will mitigate these risks ...........................................................................................................8
1.2 compile eight audit engagement procedures that can be used to test the fairness of the
accounts receivable balance of friedman LTD .................................................................................8
2.1 During an internal audit of Circle Limited wages , the following summarized system
description was handed over to you................................................................................................8
Identify and discuss four weaknesses in the above control system for wages ...............................8
2.2 describe three controls that will prevent unauthorized changes or additions to the
computerized standing data in the employee masterfile ................................................................8
QUESTION 1
QUESTION (18 MARKS)
Part A
Friedman Limited is a company that sells new and second-hand executive cars to the
public. The company has showrooms in Cape Town, Pretoria and Johannesburg. The Cape
Town premises has spare capacity and a large warehouse is used for the sale of various
types of spare parts and accessories to motor mechanics. These items are sold on a cash or
credit basis. According to the organisation’s discount policy, a standard rate of 2,5%
1
