Audit Program Design Part Ii - Acc546 Essay example

1797 Words May 23rd, 2011 8 Pages
Audit Program Design Part II
ACC/546
May 2, 2011

Audit Program Design Part II

The audit of Apollo Shoes, Inc. requires a design of steps to develop audit objectives to plan the audit. The financial statements are divided into cycles to better manage the audit and disperse to staff within the firm. The following cycle’s sales and collection, payroll and personnel and acquisition and payment were developed to design test of controls, substantive tests of transactions and analytical procedures.
Anderson, Olds, and Watershed, LLP will be designing test of controls, substantive tests of transactions and analytical procedures for Apollo. This will allow our firm to better understand the internal controls within their company along
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Auditors measure the amounts of receivables on hand, how old the accounts are in the general ledger, and the amount of bad debts the company is estimating for non collectable accounts. Testing will also be done to ensure that money collected is posted to the correct receivables accounts; this test alerts auditors to any fraudulent accounting practices in Apollo Shoes such as embezzlement or theft. If a large number of the random sample contains several violations of GAAP or the company's accounting policy, a second sample will be tested to determine how pervasive the errors are in the accounting process for the sales and collection cycles. Upon completing the audit, a written assessment will be given to Apollo Shoes management with recommendations on correcting any accounting violations (Arens, Elder, & Beasley, 2006).

Payroll and personnel cycle
Audit Objective Test of Control Test of Transaction
Personnel records contain Examine the personnel records Compare an employees accurate and detail for proper documentation, information with detail information about the employee copies of drivers’ license on on file. including of rates of pay, file, W-4. Review for signatures
W-4, union records, authorized deductions, etc.

Authorization cards for rate Examine documents for Review information changes, new hires, termination

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