AUI4862 Assignment 2 (COMPLETE ANSWERS) 2025

AUI4862 Assignment 2 (COMPLETE ANSWERS) 2025 - DUE 2025; 100% TRUSTED Complete, trusted solutions and explanations. For assistance, Whats-App 0.6.7-1.7.1-1.7.3.9. Ensure your success with us. ..ABC Limited has a well-established internal audit function (IAF), which employs risk-based auditing. The IAF has reviewed the risk assessment processes conducted by the risk management department and decided after consultation with the audit committee of ABC Limited to rely on the risk assessments performed by that department. The IAF is preparing an internal audit plan for the next three years based on the risk register provided by the risk management department. Only four (4) internal audits can be performed in each year owing to two of the internal auditors being on maternity leave. REQUIRED MARKS 2.6 Based on the information in the case study, compile a list of the order in which the risks will be audited over the next three (3) years. Provide an explanation for your answer. QUESTION 1 25 marks Part A The Holiday Factory (Pty) Ltd, is a manufacturing company in the marine engineering sector. The Memorandum of Incorporation contains, among other things, the following clause: "Any director or prescribed officer of the company who has a personal financial interest in a contract in which this company has entered or will enter, either directly or indirectly, shall comply with the Companies Act 2008. The contract will be binding provided that the authority of the company in a general meeting is obtained by poll for the contract prior to the contract being entered into." The minutes of the directors’ meetings revealed the company entered into a contract with Iceland (Pty) Ltd for the purchase of 3 highly sophisticated and expensive radar systems valued at approximately R1 million each. Thabo Shabalala is a director of Holiday Factory (Pty) Ltd, and his brother Oscar is the majority shareholder of Iceland (Pty) Ltd. REQUIRED MARKS 1.1 Discuss the requirements of the Companies Act 2008 in relation to the contract entered into by Holiday Factory (Pty) Ltd with Iceland (Pty) Ltd, particularly in view of the relationship between Thabo and Oscar. (12) Part B You are one of the senior internal auditors employed by the South African (SA) Navy. Holiday Factory (Pty) Ltd and the SA Navy entered into a project where engineers from Holiday Factory (Pty) Ltd will provide training to engineers in the SA Navy to assist them with the use of new technology manufactured to determine the increase of sea levels due to global warming while patrolling the South African coast. Funding was received from various international organisations incorporated in the United States of America to assist in providing the training at various locations. The investor companies all trade on the international markets. The internal auditing department from the SA Navy was requested to audit the compliance of this project with the applicable laws, rules and regulations. Your specific task is to evaluate the adherence of the project to appropriate legislation with specific reference to a risk management and/or control framework. REQUIRED MARKS 1.2 Identify and discuss the applicable legislation(s), regulations or any international acts that can apply to the SA Navy when doing this compliance audit. (13) [Adapted from Advanced Internal Audit Topics, 2012] This study source was downloaded by from CourseH on :45:11 GMT -05:00 TL102_0_2025 4 QUESTION 2 60 marks ABC Limited is a telecommunications operator in Africa, which offers connectivity and digital services to its customers. The company has been in operation for over 30 years and believes in the power of connectivity and digital services to strengthen the resilience of economies. Part A ABC Limited‘s risk management framework is aligned with the requirements of the King IV Report and consists of all of the following activities: a) Understanding all the key risks b) Ensuring that the treatment of all the high risks is effective c) Setting the risk strategy for the organisation d) Providing assurance on the risk management processes e) Establishing and communicating the risk management departments’ vision f) Training staff in the risk management department g) Facilitating risk identification and assessment h) Evaluating the reporting of key risks Enterprise risk management (ERM) allows ABC Limited to identify key risks and provide the executive management and the board with a comprehensive evaluation of the organisation’s principal risks. The principal risks are identified after a process of objective setting and risk assessment. The process adopts a bottom-up and top-down approach to identify and allocate risks across all levels of the organisation. Internal controls are fully embedded into all operations. REQUIRED MARKS 2.1 Indicate for each of the risk management activities (a-h) in Part A, which of the following relevant role players will be responsible for the activity. 1.1.1 Board of directors/Risk Committee 1.1.2 Senior management/Risk Management Department 1.1.3 Internal Audit Function Your answer must be in the following format: Risk management activity Role player a) Understanding all the key risks ? b) Ensuring that the treatment of all the high risks is effective ? (8) 2.2 Identify and explain ABC Limited’s risk maturity level.Part B Below is a section from the Integrated Report for 2024: ABC Limited’s mission is “Connecting for a better future”. This mission can be actioned to mean: • Connecting people and things to the internet (Digital society) • A digital future that is accessible to all (Inclusion for all) • Reducing our environmental impact (Planet) To reach the above mission, three strategic objectives were identified: (I) Africa’s leading communications company (II) Diversify and differentiate with our digital ecosystem (III) Optimised future-ready TechCo The actions to be undertaken to ensure that the strategic objectives are achieved are as follows: Strategic objective Operational objective I (a) Enhance and strengthen footprint in Africa. (b) Secure the organisation’s leadership in the mobile and fixed connectivity environment. II (c) Improved financial and digital services to customers. (d) Be the digital partner of choice for enterprises. (e) Provide customers with a world-class experience (f) Personalisation – Develop products in accordance with customers’ unique needs. III (g) Optimise assets to optimise value creation for customers. (h) Provide technology leadership in network and information technology. (i) Build an organisation of the future underpinned by digital innovation. (j) Maintain brand trustworthiness and reputation The risk management process identified the following risks to the organisation: 1 Cyber threats 2 Increased taxation, political and social pressures 3 Unstable economic and market conditions 4 Vendor strategy: Geopolitical influences can potentially negatively affect IT and technology This study source was downloaded by from CourseH on :45:11 GMT -05:00 TL102_0_2025 6 vendor strategy. 5 Adverse regulatory and compliance pressures 6 Resilience of the financial services platform 7 Technology failures – reliability and availability of high-quality network for customers 8 Market disruptions 9 Execution of strategic projects for future growth 10 Failure to secure additional network and data licences owing to policy changes The following risk heatmap sets out the risks in relation to its impact and likelihood for each of the risks. Figure 1: Heat Map 1 REQUIRED 2.3 2.4 List the activities and steps in a risk management process. In table format, match each of the operational objectives with the relevant risks that will affect the achievement of that objective. Note that a risk can be relevant to more than one operational objective. Nr Operational objective Risk (4) This study source was downloaded by from CourseH on :45:11 GMT -05:00 TL102_0_2025 7 a) Enhance and strengthen footprint in Africa ? (23) 2.5 Using the above heat map complete the risk register below (using high, medium and low) for ABC Limited. Nr Risk Impact Likelihood