Applied Auditing Project

Description: In this assignment, you will assume the role of staff auditor. Your client is the Parks and

Recreation Department in Boston, Massachusetts. Your task is to perform substantive and analytic

procedures on the cash disbursements for fiscal year $($FY$)23.$ You will write up a formal report, which

includes the results of substantive procedures that will ultimately be included in the audit working papers.

Objective: To evaluate and analyze cash disbursements made by the Parks and Recreation Department

during fiscal year $23$ through substantive and analytic procedures. This assignment is designed to give

students experience using real world data and performing typical analytic and data organization tasks.

Important Client Note: The fiscal year for the client runs from July $1$ to June $30.$ You will need to

adjust your tests$/$analysis accordingly. You have access to the cash disbursements for FY $21,22,23,24.$

All are contained within a single CSV file that can be read in Excel or another software of your choice.

Audit Tasks $($x$5)$

Substantive Procedure $1$: Create a graph showing the trend in total cash disbursements by month

between the start of FY$21$ to FY $24.$ Discuss what you find. Points to consider in your discussion may

include but are not limited to:

$$ What are the trends you discover?

$$ Are there any patterns?

$$ Can you make any inferences from these trends or patterns?

$$ What additional information might you require from the client?

Deliverable: PDF $($including discussion and graph$).$

Substantive Procedure $2$: Stratify the sample for FY$23$ into quartiles by disbursement amount. Select a

random sample of cash disbursements from each quartile. If the number if items sampled from each

quartile differs, then discuss why this is the case. Be sure to include anything else in your discussion that

you find or think is relevant.

Deliverables: Excel $($showing selection from stratified sample for each quartile group$)$; PDF $($discussion$).$

Substantive Procedure $3$: Analyze disbursements in the first month of FY$24$ and select a sample for

further testing. Discuss what relevant assertion Substantive Procedure $3$ is meant to address. Further

discuss your choice of sample, and any additional inquiries you would like to make of the client.

Deliverable: Excel $($showing selection from FY$24)$; PDF $($discussion$).$

Substantive Procedure $4$: Test for duplicate payments, unusual, and outlier disbursements in FY$23.$

Discuss your findings and what additional information you will need from the client.

Deliverable: Excel $($showing and identifying your selection of duplicates, unusual, and outlier

disbursements. Organize each selection into at least one of the three groups$).$ PDF $($discussing what you

find and what additional information you require, and why$).$

Substantive Procedure $5$: Create a list of the top $5$ highest paid vendors in FY$23.$ Discuss what

additional details you will need from the client including any potential additional inquiries.

Deliverables: PDF $($Discussion of additional evidence required$)$; Excel $($Detail of the top $5$ vendors and

total amount paid.

Deliverables Summary

Each student will individually work on and submit their own project, which should consist of $(1)$ PDF

document and $(1)$ Excel file. The PDF should contain the discussion portion of the assignment and be

organized by task. The Excel file should contain the required material outlined in each task. The Excel

file should contain a separate worksheet for each task, be organized, easy to read, and should support the

writing in your discussion.