a) Explain the factors an militer Thould consider when discoming the adequacy of a client's internal control cystem. (6 marks) b) Highlight the possible deferences mailable to as auditor in a court of law who has been sund for to detect froud in climb's company.(5 marks) (i) in order to conduct an andit effectively and efficiently, an undition should properly plan for the anignment Faplain the matter that an andikor should take into account at the planning stage of an madit exercise (B marks) i) Identify and explain the functions of the internal muslit department in an organization. (4 marks) c) Explain the meaning of the term "madit commince a marks) 1) State and briefly explain the objectives of an walit poor review is marks) a) What hithes

Question

a) Explain the factors an militer Thould consider when discoming the adequacy of a client's internal control cystem. (6 marks) b) Highlight the possible deferences mailable to as auditor in a court of law who has been sund for to detect froud in climb's company.(5 marks) (i) in order to conduct an andit effectively and efficiently, an undition should properly plan for the anignment Faplain the matter that an andikor should take into account at the planning stage of an madit exercise (B marks) i) Identify and explain the functions of the internal muslit department in an organization. (4 marks) c) Explain the meaning of the term "madit commince a marks) 1) State and briefly explain the objectives of an walit poor review is marks) a) What hithes

Answer 1

a) When determining the adequacy of a client's internal control system, a military auditor should consider the following factors:1. **Control Environment**: The tone set by management and the organization's ethical values.2. **Risk Assessment**: Identification and evaluation of risks that may impact the achievement of objectives.3. **Control Activities**: Policies and procedures that help ensure management directives are carried out.4. **Information and Communication**: Systems that support the identification, capture, and exchange of information.5. **Monitoring**: Processes to assess the quality of the internal control system over time.b) Possible defences available to an auditor in a court of law who has been sued for failing to detect fraud include:1. **Due Diligence**: Demonstrating that the audit was conducted with due care and diligence.2. **Professional Standards**: Adhering to established auditing standards and guidelines.3. **Documentation**: Providing comprehensive records of the audit process and findings.4. **Communication**: Maintaining open lines of communication with the client and stakeholders.5. **Expert Testimony**: Utilizing expert witnesses to support the auditor's position.c) In order to conduct an audit effectively and efficiently, an auditor should take into account the following matters at the planning stage:1. **Scope and Objectives**: Clearly defining the audit's goals and boundaries.2. **Timeframe**: Establishing a realistic timeline for the audit process.3. **Resources**: Allocating necessary personnel, technology, and other resources.4. **Risk Assessment**: Identifying potential risks and developing strategies to address them.5. **Client Relationship**: Building a positive and cooperative relationship with the client.d) The functions of the internal audit department in an organization include:1. **Risk Management**: Identifying and assessing risks to the organization.2. **Compliance**: Ensuring adherence to laws, regulations, and internal policies.3. **Performance Improvement**: Evaluating and improving the efficiency and effectiveness of operations.4. **Reporting**: Providing objective and timely reports on audit findings and recommendations.5. **Advisory Services**: Offering guidance and support to management on various matters.e) The term "audit committee" refers to a group of individuals, often members of the board of directors, responsible for overseeing the internal audit function. Their duties include:1. **Governance**: Ensuring the audit function operates independently and effectively.2. **Policy Oversight**: Reviewing and approving the audit plan and budget.3. **Resource Allocation**: Ensuring adequate resources are available for the audit function.4. **Performance Monitoring**: Evaluating the performance of the internal audit department.5. **Ethical Standards**: Upholding the highest ethical standards in the conduct of audits.f) The objectives of an external peer review are:1. **Assessing Quality**: Evaluating the quality of the audit work performed by the peer firm.2. **Improving Standards**: Identifying areas for improvement in the peer firm's audit practices.3. **Enhancing Credibility**: Increasing the credibility of the peer firm's audit reports.4. **Compliance**: Ensuring the peer firm adheres to professional standards and regulations.5. **Professional Development**: Providing opportunities for peer firm staff to learn and grow.

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