Professional Documents
Culture Documents
APA Parts 1b and C
APA Parts 1b and C
SEMESTER 2, 2014
ASSIGNMENT 2
OVERVIEW:
This assignment provides an opportunity for you to consider the meaning and operation of internal control by reflecting on the design,
implementation and effectiveness of internal control plans in a business process.
The specific skills addressed include:
Evaluating the appropriateness and potential use of control plans within the process.
GROUP SIZE:
The assignment is a group assignment. Assignments are to be completed in groups of four or five. You may work with any student enrolled in
the subject.
GENERIC SKILLS ADDRESSED:
This assignment addresses the following generic skills: collaborative learning; problem solving; team work; interpretation and analysis; critical
thinking; evaluation of data and other information; use of computer software; written communication; application of theory to practice.
PLAGIARISM: You are cautioned against copying and relying on the work of others. Copying the work of others is plagiarism and as such
carries severe penalties.
WEIGHTING: 15% of the overall subject result
Task:
A flowchart for a business process follows this page. You are required to (1) analyse the process and complete the attached control
framework, and (2) answer the question that follows the control framework. All answers should be based around the process that is
depicted in the flowchart provided.
(1) CONTROL ANALYSIS FRAMEWORK
You are required to complete the four stages of the Control Analysis Framework.
Follow the instructions contained within each stage when completing the control framework.
MARK ALLOCATION:
Question 1 (PARTS A-D): 25 marks
Question 2:
TOTAL:
5 marks
30 marks (converted to a score out of 15 for assessment)
Word Limit: 1400-1500 WORDS (excluding in-text references and reference list). Note: a 10% leeway is built into the word limit range above.
Your assignment cannot exceed 1500 words.
Where appropriate, references should be used to substantiate your discussion. Use either the Harvard or APA referencing systems. More
information is available from the Centre for Teaching and Learning: http://fbe.unimelb.edu.au/celt/tools/helpsheets
GROUP LEADER
Student Number
Student First Name
Student Last Name
Tutors Name
Tutorial Day
Tutorial Time
OTHER GROUP MEMBERS:
Student Number
Student First Name
Student Last Name
Tutors Name
Tutorial Day
Tutorial Time
Student Number
Tutors Name
Tutorial Day
Tutorial Time
Student Number
575948
Anna
Nguyen
Tutors Name
Alec Baenziger
Tutorial Day
Monday
Tutorial Time
4.15pm
M1
M2
M3
4 MARKS
3 MARKS
10
11
9 MARKS
(b) For the process documented in the flowchart:
a. Identify ONE (1) risk for which there is a MISSING control plan for each of the information reliability goals;
b. Specify the financial statement accounts impacted from this risk;
c. Specify whether the account would be over or understated as a result of the risk.
Risk to Information Reliability
1. Theft
VALIDITY
Unearned Revenue
Overstated
ACCURACY/COMPLETENESS
DETAILED LEVEL
Unearned Revenue
Unearned Revenue
Understated
3 MARKS
12
13
14
M1
M2
M3
mitigate the risk, and complete the tables that follow. You must provide a detailed explanation of how the plan works and how it will
15
Control Activity
Validity
Accuracy
Event
Level
Detail
Level
Risk 1: Theft
Control Plan: Deposit slip authorised by two supervisors
M1
M1
M1
Explanation of how plan works and achieves the information reliability goals:
After the supervisor prepares the deposit slip, another person of authority checks that amount to be deposited into the bank accurately
matches the amount recorded in the daily cash report. Once the second person of authority confirms that amount is corresponds, he/she will
sign the deposit slip as well. This preventative control reduces the possibility of cash being stolen and ensures that the the amount of cash
recorded deposited into the bank equals the displayed by the valid daily cash report. The primary goal of this plan is to ensure that all
transactions that are recorded are also receipted by the bank so that validity is achieved. The control plan also ensures that the deposit slip
has been correctly filled in and hence allowing accuracy and completeness at the detail level to be achieved.
16
Control Activity
Validity
Accuracy
Event
Level
Detail
Level
The customer service representative enters the cash amount received twice and then the computer checks that two sets of inputs are identical and only
when the two sets of inputs are identically that the customer service representative can proceed to next step of the transaction. This amount is then
reiterated to the customer to confirm that the amount keyed in is accurately reflects the cash given by the customer. This control plan ensures that incorrect
data entry is detected in time and correction measures can be put in place to so that the correct amount is registered in the system. This is done before cash
is stored into cash register so that if customer claims that amount is incorrect, this can be confirmed by recounting the amount of cash given.
Control Activity
Validity
Accuracy
Event
Level
Detail
Level
17
M3
M3
Explanation of how plan works and achieves the information reliability goals:
After the card balance has successfully been updated, the computer displays the new account balance and the customer service
representative confirms this with the customer. This ensures completeness in the event level is achieved level as it notifies when the event
has successfully been captured into the system. It also allows the confirmation that the correct amount of cash has been keyed into the
system and hence ensuring the accuracy is achieved. If the new card balance is identified to be incorrect, corrective measures can be put in
place in a timely manner such as reprocessing the entire transaction so that the correct amount of the transaction is captured in the
systems records. The primary goal of this control plan is to ensure that all valid transactions are recorded into the system so that
completeness at the event level is achieved.
9 MARKS
d)
(i) Conclude the extent to which the process as it currently operates achieves each of the information reliability goals. Justify your
conclusion using present and missing control plans. Your answer should refer to more control plans than the three in your answer to
part c, above.
(ii) Annotate the flowchart to indicate where the present control plans that you mention in your evaluation are in the process (P-X);
and annotate where the missing control plans that you mention in your evaluation should be (M-X).
8 MARKS
18
19
Where in the process batch totals should be used (refer to flow numbers on the flowchart).
()
()
Identify and describe the risk and information goal(s) that batch totals would address.
()
Explain how the batch total you suggested addresses the risk and goal in (iii).
(5 MARKS)
20