Navigating the Pandemic: 3 Strategies for Finding Opportunities - Essay Sample

Question 1

Listening to this podcast has shifted my perceptions to see beyond the Covid-19 pandemic. It has challenged me to find the courage to look for opportunities presented by this pandemic by cultivating a positive attitude approach to every situation. To do so, it has outlined three themes that I can employ to help me make better decisions now and in the future. These themes are; 'The importance of community, valuing curiosity and Fear and mindset.' I have learned that if effectively approached, these three themes will enable me to identify all opportunities presented to me by this pandemic and how best to prepare for launching post the pandemic.

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Question 2

Upon discovery of an omitted procedure that ought to have been included during the audit process, the auditor must immediately assess the extent to which the overlooked procedure would vary before released audit reports. The auditor would have to revisit the working papers, audit engagement interviews, and a general revision of the whole auditing process. If the auditor happens to conclude that the omitted procedure dramatically varies with the prior findings, they must resort to applying the overlooked method to support accurate results immediately (Ramos, 2003; DeZoort & Harrison, 2008).

Question 3

Cutoff Analysis- In this procedure, the auditor examines both the last receiving and shipment made in the warehouse. The purpose of this to exclude any transactions in and out of the warehouse that falls outside the audit timelines. The use of computer-aided audit tools increases the accuracy of the audit tests by reducing the auditor's dependence on the client for information. Besides, the application of a computerized perpetual inventory database system offers the auditor real-time, quick, and reliable information on the point of sale transaction of the warehouse.

Observe the physical inventory count- In this procedure, the auditor most engages in manual work of revisiting the processes used in counting the inventory, discuss and observe the counting procedures used by the company. Application of both the CAATs and the computerized perpetual inventory database system helps the auditor compare the entries made and the accuracy of the amounts recorded to verify if they have correctly been accounted for.

Reconcile the inventory count to the ledger- At this point, the auditor assesses and compares the valuation made in the physical inventory to the general company' accounting. In doing so, he aims to establish that the counted balance was carried forward to the company's accounts. Employing computer-aided audit tools will minimize the misinformation and misrepresentation of the statements by the clients, as the auditor will barely rely on the client's testimonials. Besides, the result of the audit experience stands to be successful by the reliance on a computerized perpetual inventory database system as it exposes information to the fine tune of discounts, purchases, and returns made by the company (Aobdia et al., 2019).

Question 4

The auditor has a moral responsibility to disclose management's fraud to outside parties on the grounds of the following three circumstances. One, the auditor can disclose a managerial level of fraud to a successor auditor in case of an inquiry made to aid in future audit processes. Two, an auditor has a moral obligation to report to funding agencies in cases where the client company is a recipient of governmental financial assistance. Lastly, an auditor can disclose fraudulent findings of the management to a third party as an act of responding to a subpoena (Christensen et al., 2019).

Question 5

To efficiently carry out an audit procedure, the audit team ought to engage in preliminary engagement activities to minimize the audit risks, hence performing their duty in a timely and efficient manner. One, the audit team should clarify the status of their engagement- continuance of client relationship and further determine the nature of the audit engagement. They should also determine if their client is compliant with ethics requirements and the law. Lastly, they should establish their terms of commitment to minimize future misunderstandings. Also, in case of an initial audit, the team ought to communicate with predecessor auditors to remain updated on the trends of audit reports and essential information that they may need to take into account during their audit exercise (Drogalas et al., 2017).

Question 6

It is of utmost importance that auditors familiarize themselves with the acquisition and expenditure cycle as it comes with many benefits that make their work easier. First, an excellent study of the acquisition and expenditure cycle enables an auditor to determine the approved vendor list. It furthers gives assess to the vetting process used to award tenders to the vendors and that they all meet the company's policies and procedures of engagements (Chui & Pike, 2013). Besides, from this information, the auditors are further able to reconcile data from unmatched vendor invoices with unmatched vendor reports to reach a reliable conclusion on the client's assets and liabilities. In conclusion, the auditors get the benefit of examining the companies' bill of lading, which further helps them make informed conclusions during their audit exercises. These are essential auditors familiarizing themselves with the acquisition and expenditure cycle.

References

Aobdia, D., Choudhary, P., & Newberger, N. (2019). The Economics of Audit Production: What Matters for Audit Quality? Available at SSRN 3300277.

Christensen, B. E., Newton, N. J., & Wilkins, M. S. (2019). Archival Evidence on the Audit Process: The Effect of Early Planning and Interim Effort on Audit Hours, Disclosure Timeliness, and Audit Quality. Disclosure Timeliness and Audit Quality (April 2, 2019).

Chui, L., & Pike, B. (2013). Auditors' responsibility for fraud detection: New wine in old bottles? Journal of Forensic and Investigative Accounting.

DeZoort, T., & Harrison, P. (2008). An evaluation of internal auditor responsibility for fraud detection. The Institute of Internal Auditors Research Foundation.

Drogalas, G., Pazarskis, M., Anagnostopoulou, E., & Papachristou, A. (2017). The effect of internal audit effectiveness, auditor responsibility, and training in fraud detection. Accounting and Management Information Systems, 16(4), 434-454.

Ramos, M. (2003). Auditors' responsibility for fraud detection. Journal of Accountancy, 195(1), 28-36.