Question
. You are assigned as a External Auditor of the Democracy LLC. During external audit work you found out issues that are described below: Company
. You are assigned as a External Auditor of the Democracy LLC. During external audit work you found out issues that are described below:
Company has problems in IT system relating to the preparation of financial statements. Accountants input figures to the system but further processing of the figures to the trial balance fails every time.
All wages and statutory deductions are calculated only by payroll clerk. These figures are not reviewed and authorized by anyone.
Company costs are high so that company cannot gain any competetive advantage in the market.
During the year, two employees suspended in fraudulent financial reporting by changing adminstrative expenses and overstating profits.
Required: Identify Internal Control defficiencies and suggest a recommendation to address each deficiency
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