Question : Internal controls and tests of controls : Stanford-Brown University runs residential colleges on each of its five campuses spread all over regional New South Wales. You are conducting the interim audit for the year ended 30 June 2020. The tangible fixed assets of each college are recorded in an asset register which is maintained at each college location by each college manager. The system operates as described below. 1. In order to obtain new assets, a purchase requisition form is completed and approved by the manager at each college. 2. The requisition is sent to the Universitys Division of Finance, where the purchasing officer checks the requisition for approval and completes a purchase order for the new asset. 3. Assets costing more than $5,000 are approved by the financial accountant. All asset purchases over $20,000 require the approval of the Universitys Finance Director. 4. The purchase order is then sent to the supplier and a copy is sent to the Division of Finance on the main Whoop Whoop campus. 5. The asset is received by the central store where the receiving clerk checks that all the asset details agree with those on the receiving report and the copy of the purchase order. The receiving clerk then issues the asset with its computer-generated sequential barcode number. This barcode is fixed to the asset and written on the receiving report and the supplier invoice. 6. The relevant college manager inputs the new asset details into the asset register using a copy of the purchase order, the original requisition and the asset's barcode. 7. For disposal or write-off of an asset, an asset disposal write-off form is completed by the relevant college manager, signed and sent to the Division of Finance. Disposals and write-offs are approved by the financial accountant. A copy of the form is filed at the Division of Finance and the approved original returned to the college manager for action. The college manager then updates the fixed asset register for the subsequent disposal. 8. The asset register is maintained on FARS - a tailored fixed assets computer system - and reconciled to the general ledger by each college manager monthly. 9. The FARS system calculates depreciation automatically each month using the rate input by the college manager at the time the asset was added to the register. Required 1. Identify four internal control strengths on which you would rely on for your audit. 2. Design four tests of controls to evaluate the effectiveness of each control identified.