An audit report found the following:

Industrial Engineering did not submit timely cost standards for establishing direct labor usage data required for developing budgeted labor costs for the standard cost budgeting system. This caused faulty 2018 standards costing and quantity and variance analyses leading to weaknesses in the budget analyses and underpricing for products sold costing $232,474.

Based on the above answer the following:

Condition what happened?

Criteria what is the standard? (the proper procedure that should have been in place to avoid such thing)

Cause why did it happen?

Effect cost or problem?

Recommendation how does the auditor (you) recommend fixing the problem?