You are auditing White Pty Ltd (White). When you visited White at the planning stage of the audit for the purpose of gaining an understanding of its internal controls, you wrote the following narrative description of internal controls over sales.

Customers place their orders via email. When a customer order is received, a Sales Clerk prepares a Sales Order in triplicate. Copy 1 is forwarded to the Credit Department, where the Credit Clerk checks that the value of the order is within the customer's credit limit. Where everything is satisfactory, he signs the Sales Order and returns it to the Sales Clerk who files it with the customer's email. Copy 2 is forwarded to the Warehouse, and Copy 3 is forwarded to the Accounts Clerk who files it by date.

In the Warehouse, a Shipping Clerk uses Copy 2 of the Sales Order to pick the goods. He then prepares a Shipping Order, in triplicate, using the information on the Sales Order. A second Shipping Clerk checks that the details on the Shipping Order match the goods to be shipped and initials the Shipping Order to show that he has performed the check. He then packages the goods and places them on the delivery truck with Copy 1 of the Shipping Order. Copy 2 of the Shipping Order is filed with the Copy 2 of the Sales Order in the Warehouse, and Copy 3 is forwarded to the Accounts Clerk, who files it with the corresponding copy of the Sales Order.

Once a month a Clerk from the Accounting Department visits the Warehouse. He selects a sequence of twenty Shipping Orders and accounts for each one. To show that he has performed this review, he initials each Shipping Order in the sequence.

The preliminary assessment of control risk that you made while gaining an understanding of White's internal controls was that control risk for sales was not high. Accordingly you will test the effectiveness of White's the internal controls over sales.

REQUIRED

Based only on the facts provided above, specify the following tests of controls. Ensure that for each test, you also identify the evidence source, the procedure used by the auditor, the attribute of interest and whether or not sampling would be used.

(i) Test 1: A test of control for the occurrence assertion with respect to sales at White. (4 MARKS)

(ii) Test 2: A test of control for the completeness assertion with respect to sales at

White.(4 MARKS)