Essay about Identification of Tests of Controls

1153 Words 5 Pages
Southeast Shoe Distributor, Inc.:
Identification of Tests of Controls for the Revenue Cycle
(Sales and Cash Receipts)

After completing and discussing this assignment you should be able to • Recognize common documents and records used to record transactions in the revenue cycle • Recognize common control activities used to process transactions in the revenue cycle • Identify client control activities that reduce the likelihood of material misstatements • Link client control activities to management assertions • Identify tests of controls for each control activity identified

INTRODUCTION Southeast Shoe Distributor (SSD) is a closely-owned business that was founded 10 years ago
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Bill Zander completed steps 1 through 4 and has documented the results of his work in working papers RI-1, R 30-1, R 30-2, R 30-3, and R 30-4 (Note: you should assume that only control activities identified in the flowcharts exist). Audit steps 5, 6, and 7 can be completed separately. Your instructor will indicate which steps you are to complete.

This case was prepared by Frank A. Buckless, Ph.D. and Mark S. Beasley, Ph.D. of North Carolina State University and Steven M. Glover, Ph.D. and Douglas F. Prawitt, Ph.D. of Brigham Young University, as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of an administrative situation.
Copyright © 2000 by Prentice-Hall, Inc. ISBN 0-13-016948-X.

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| |Reference: R 1-1 |
| |Prepared by: BZ |
| |Date: 6/12/OX |
| |Reviewed by: |

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