Seagrass Company Audit
Seagrass Company employs Carol Jones, an independent Certified Public Accountant (CPA) to conduct the organization’s annual accounting audit. In conducting accounting audits, auditors employ sampling strategies of key general ledger accounts and transactions to determine the effectiveness of internal controls, accuracy of data, and detect potential misstatements and fraudulent activities. Examination of Ms. Jones’ completed audit reveals incorrect assumptions, statements, and inappropriate application of audit procedures.
Monetary Unit Sampling Sampling is an essential tool in effectively auditing accounting records of an organization. Said tool is utilized to test the internal control procedures, account balances, and …show more content…
Ms. Jones’ audit of Seagrass Company would, therefore have utilized a more appropriate sampling method than MUS which provided the inaccurate assumptions and statements by Ms. Jones had GAS been employed in completing the audit.
Furthermore, GAS would have provided Ms. Jones with analysis of 100 percent of Seagrass Company data. Ms. Jones conducted her audit of only Accounts Receivable to determine overstatements. A complete audit should also analyze inventory, accounts payable and sales. Documents should be checked for gaps in sequences, which GAS would accomplish for Ms. Jones saving vast amounts of time to complete said audit.
Finally, through employment of GAS, Ms. Jones would retain control of risk limits by instructing the software on said information. GAS will then conduct the analysis of data and provide documentation of analyzed data reporting data which violates the stated risk levels. Ultimately, utilizing GAS would provide more accurate and complete audits by Ms. Jones, ensuring her clients’ data is accurate and free from fraudulent
Seagrass Company employs Carol Jones, an independent Certified Public Accountant (CPA) to conduct the organization’s annual accounting audit. In conducting accounting audits, auditors employ sampling strategies of key general ledger accounts and transactions to determine the effectiveness of internal controls, accuracy of data, and detect potential misstatements and fraudulent activities. Examination of Ms. Jones’ completed audit reveals incorrect assumptions, statements, and inappropriate application of audit procedures.
Monetary Unit Sampling Sampling is an essential tool in effectively auditing accounting records of an organization. Said tool is utilized to test the internal control procedures, account balances, and …show more content…
Ms. Jones’ audit of Seagrass Company would, therefore have utilized a more appropriate sampling method than MUS which provided the inaccurate assumptions and statements by Ms. Jones had GAS been employed in completing the audit.
Furthermore, GAS would have provided Ms. Jones with analysis of 100 percent of Seagrass Company data. Ms. Jones conducted her audit of only Accounts Receivable to determine overstatements. A complete audit should also analyze inventory, accounts payable and sales. Documents should be checked for gaps in sequences, which GAS would accomplish for Ms. Jones saving vast amounts of time to complete said audit.
Finally, through employment of GAS, Ms. Jones would retain control of risk limits by instructing the software on said information. GAS will then conduct the analysis of data and provide documentation of analyzed data reporting data which violates the stated risk levels. Ultimately, utilizing GAS would provide more accurate and complete audits by Ms. Jones, ensuring her clients’ data is accurate and free from fraudulent