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Each of the following audit procedures is being used in the audit of Rockport Homes, Inc., to test the production control activities. Required:
Each of the following audit procedures is being used in the audit of Rockport Homes, Inc., to test the production control activities.
Required:
For each of these procedures identify (a) the strength of the internal control procedure being tested and (b) the internal accounting objectives being addressed.
Audit Procedure
(a) Strength
(b) Objective
- 1.Select a sample of the documents prepared when raw materials are released from stores. Examine and tie the job number to the cost accounting records.
- 2.Select a sample of the materials release documents in the production department file. Examine for foreman's signature or initials.
- 3.Select a sample of the materials release documents in the production department file. Examine for issue date/material usage report date.
- 4.Select a sample of the materials release documents in the production department file. Examine for name and item number of the material.
- 5.Select a sample of the materials release documents in production department file. Examine for the clerk's signature or initials who issued the raw materials.
- 6.Select a sample of the materials release documents in the production department file. Examine for matching material requisition in raw materials stores file, noting the date of requisition.
(Hooks 791-792)
Hooks, Karen L. Auditing and Assurance Services: Understanding the Integrated Audit. Wiley, 03/2010. VitalBook file.
The citation provided is a guideline. Please check each citation for accuracy before use.
