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For the 10 scenarios that follow, fill in the empty cells to the right to correctly classify each of the 10 scenarios and relate them

  • For the 10 scenarios that follow, fill in the empty cells to the right to correctly classify each of the 10 scenarios and relate them to the correct cycle, audit test, management assertion, audit objective, control activity, and/or evidence type using a corresponding letter (ex: A or BB) from the list below for each cell.
  • Ignore cells that are blacked-out. A given selection can be used once, more than once, or not at all. Only one letter per cell (ex: FF is a letter). It is possible that there might be more than one correct answer for a question - but you should choose only one letter (ex: A or BB) per cell.
  • Note that items above with dashes are replications - therefore you must find the caption with the same wording but with a letter preceding the caption and use its letter for the empty cell (ex: the letter H is to be used for all answers using Completeness though there are three other Completeness items with dashes preceding them) - NEVER use dashes as the answer!

Selection Choices

A. Segregation of duties

B. Design/use of documents

C. Safeguards of assets & rec.

D. Independent checks on perf.

E. Proper authorization

F. Occurrence

G. Classification

H. Completeness

I. Accuracy

J. Cutoff

K. Valuation and allocation

L. Rights and obligations

M. Existence

Completeness

N. Tests of controls

O. Substantive tests of transactions

P. Analytical procedures

Q. Tests of details of balances

Occurrence

R. Posting and Summarization

Completeness

Accuracy

Classification

Cutoff

T. Realizable value

U. Calibration

Accuracy

Existence

Completeness

V. Detail tie-in

Classification

Cutoff

Rights and obligations

W. Physical examination

X. Inquiries of the client

Y. Confirmation

Z. Documentation

Analytical procedures

AA. Recalculation

BB. Respecification

CC. Reperformance

DD. Observation

EE. Payroll and personnel

FF. Sales and collection

GG. Acquisition and payment

HH. Inventory and warehousing

II. Capital acquisition and repayment

JJ. Financing and investing

SCENARIOS

Scenario

Control

Activity

Evidence

Type

Audit Test

Cycle

Management

Assertion

Audit

Objective

1. Audit procedure: Test for obsolete inventory by asking factory employees and management whether they know of slow-moving or damaged goods.

2. Audit procedure: Compare inventory turnover with that of previous years.

3. Internal Control: The computer calculates gross and net pay based on hours inputted and information in employee master files, and payroll accounting personnel double-check the mathematical accuracy on a test basis.

4. Internal Control: Controller reviews monthly bank reconciliations to determine if mistakes were made by clerks.

5. Specific Transaction-Related Audit Objective: Cash disbursement transactions are recorded on the correct dates.

6. Audit procedure: Watch employees count inventory to determine whether company procedures are being followed.

7. Audit procedure: Trace the total from the cash disbursements journal to the general ledger control account.

8. Audit procedure: Trace sales journal entries to supporting documents, including duplicate sales invoice, bill of lading, sales order, and customer order.

9. Internal Control: Cash receipts are recorded on a daily basis.

10. Audit procedure: Scan the sales journal, looking for large and unusual transactions requiring investigation.

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