Audit Program Design Part Iii for Apollo Shoes Essay

1294 Words Sep 16th, 2012 6 Pages
Audit Program Design Part III for Apollo Shoes
Crystal Spencer
September 24, 2012 Deborah Fitzgerald Thomas

Sloan and Spencer Auditing Firm during phase III of Apollo Shoes audit plan, we will focus in two key cycles, which are the following: inventory and warehouse cycle and cash cycle. It is important to understand that are six types of transactions in the inventory and warehouse cycles which are: receive raw materials, store raw materials, process purchase order, and process of goods, store completed goods, and ship completed goods. In addition, it is important understand that cash is chiefly important and exceedingly vulnerable to fraudulent activity this is why an
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* Document the tag numbers for those used and unused tags for later investigation. * Inventory and purchases are in proper period. (Cutoff) * Find the last inventory of the year. * Find receiving statement or bill of lading * Make sure any inventory after this was not counted. * Inventory classified correctly. * Examine inventory description to math physical appearance. * Inventory counted is the client’s. * Ask client about customer inventory or items on consignment.

* Look for inventory that may be marked as other inventory * Search for receiving statements of customer inventory and items on consignment * Obsolete & unusable inventory items are excluded or noted. * Look for and inquire about obsolete or damage items that are rusted or dust covered, and located in inappropriate places * Examine items moved from inventory to the reserve for inventory obsolescence transactions * Ensure that correct disclosures made for inventories. * Look for and inquire about obsolete or damaged items * Examine items moved from inventory to the reserve for inventory obsolescence transactions. * Review authorized production schedules * Review procedures which control inventory
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