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NEW QUESTION 45
TT is a jewellery manufacturer in country A It makes jewellery from precious metals and stones and sells it to shops in country A and also overseas It is the 3rd largest company in country A with a huge turnover TT has found it very difficult to prevent staff committing fraud and last year the Board was sure that the year end inventory was lower than it should have been Gross profit was also slightly lower than expected Which TWO of the following internal controls would be most effective in helping to reduce staff fraud within TT?

  • A. Employ two more managers to watch the staff working and look for them stealing items
  • B. Carry out inventory checks daily to make sure the correct quantity of materials is being used every day and the correct number of items are being produced
  • C. Have a senior manager such as the Production Director to supervise the workshop at all times
  • D. Perform random checks of staff bags as they leave work and ensure the staff all wear overalls provided by the company in the workshop Their own clothes must be left in lockers during working hours
  • E. Install-several CCTV cameras in the workshop

Answer: D,E

 

NEW QUESTION 46
CH makes a popular type of chocolate bar The bars are made on a production line and are scanned for size and shape as they move along the line Wrong sized and misshapen bars are rejected as being poor quality. The scanner detects 90% of poor quality bars. If CH wants to reduce the risk of poor quality bars being sold to the public it can add a further check by a person scanning the production line as well. this check would detect 80% of poor quality bars If the further check was implemented what percentage of poor quality bars would still get through the checking process?

  • A. 2%
  • B. 10%
  • C. 7.2%
  • D. 30%

Answer: A

 

NEW QUESTION 47
E purchases parts for one of the machines it manufactures from Country X Place the risk classification next to the risk it relates to:

Answer:

Explanation:

 

NEW QUESTION 48
With regard to the rote of the audit committee which of the following statements are correct? Select ALL that apply

  • A. The audit committee should review and monitor the effectiveness of the company’s internal audit function
  • B. The audit committee should provide arrangements for whistle blowing
  • C. The audit committee should decide annually whether it needs an internal audit function
  • D. The audit committee should design the system of internal controls
  • E. The audit committee should engage consultants to carry out business reviews
  • F. The audit committee should decide annually whether it needs an external audit function

Answer: A,B,E

 

NEW QUESTION 49
……

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