The capital acquisition and repayment cycle

Two capital projects totaling $2.5 M may have been overspent by $600,000 and may not reflect the reported capital spending.

The sales and cash receipt cycle

There were 15,000 invoices totaling $122 M in sales. Unauthorized discounts applied to invoices, credit terms applied to invoices may be incorrect, and unaccounted for invoice sequence numbering may be present.

http://finance.mapsofworld.com/financial-report/statement/assertions.html

For each transaction cycle you will have the chart indicated in the assignment.

• Transaction- related audit objectives = Management Assertions
• Key Internal Control = Select an Internal Control that ties to the related management assertion
• Common Test of Controls = Select an Internal Control that ties to the related management assertion
• Common Substantive Test = Select a Substantive test that ties back to the management assertion

For each management assertion you will have a control, a common test of controls, and a common substantive test. You should end of with 5 rows of information for each cycle

• For each transaction (2) you need to include the methodology that you used to develop your charts i.e. transaction related audit objective, key internal control, common test of controls, and common substantive tests
• this is the chart that has to be done for each

Transaction Cycle Name:The capital acquisition and repayment cycle Transaction-Related Audit Objective Existence Completeness valuation Rights and Obligation Presentation and Disclosure Posting and Summarization Key Internal Controls Common Tests of Controls Common Substantive Tests of Transactions Transaction Cycle Name: The sale and cash receipt cycle Transaction-Related Audit Objective Existence Completeness valuation Rights and Obligation Presentation and Disclosure Posting and Summarization Key Internal Controls Common Tests of Controls Common Substantive Tests of Transactions