For the given scenario, identify the weakness or weaknesses in internal control and opposite the identified weaknessor weaknesses, enumerate the control procedure/s that you will recommend to avoid or mitigate the risk of loss:A small branch of Avon Cosmetics in Tuao, Cagayan employs Amelia Rodriguez as Branch Manager and Mary Gonzalesas her sales assistant. The Branch uses a bank account in Tuao, Cagayan to pay for expenses in the name of AvonCosmetics - Special Account. To pay expenses, checks must be signed by Amelia Rodriguez or John Dee, the treasurerof Avon Cosmetics. Amelia receives the cancelled checks and bank statements. she reconciles the branch accountherself and files cancelled checks and bank statements in her records. She also periodically prepares reports of cashdisbursements and sends them to thehome office in Makati.

Internal control is a process, performed by a board of directors of business, management and other…

Answered: For the given scenario, identify the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Aside from documenting his/her understanding of the internal control structure, the auditor should also document the assessed level of control risk. True or false? why?
Study and Evaluation of Management Control. The study and evaluation of management risk mitigation control is not easy. First, auditors must determine the risks and the controls subject to audit. Then they must find a standard by which performance of the control can be evaluated. Next they must specify procedures to obtain the evidence on which an evaluationcan be based. Insofar as possible, the standards and related evidence must be quantified. The following description gives certain information (in italics) that internal auditors would know about or be able to determine on their own. Fulfilling the requirement thus amounts to taking some information from the scenario and figuring out other things by using accountants’ and auditors’ common sense.The ScenarioAce Corporation ships building materials to more than a thousand wholesale and retail customers in a five-state region. The company’s normal credit terms are net/30 days, and no cash discounts are offered. Fred Clark is the chief…
In which element of Internal Control are personnel policies included: Control Procedures Control Environment O Risk Assessmenet Information and Communication O Monitoring

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For the given scenario, identify the weakness or weaknesses in internal control and opposite the identified weakness or weaknesses, enumerate the control procedure/s that you will recommend to avoid or mitigate the risk of loss: