Name: SHRIPRASAD Roll number: 521124048 Learning centre: 03248 Subject: MF0013- Internal Audit and Control Assignment

No: Set 1&2

Set-1
1. Critically evaluate the qualities of an Auditor in the wake of recent scams Ans: An auditor renders a professional service to his client. He should not only possess the prescribed statutory qualifications but also certain personal qualities. Some of those personal qualities are mentioned below: 1.Common sense: According to Spicer and Pegler, the auditor should have a full share of that most valuable commodity-commonsense. This is necessary to distinguish between important and not so important information. 2.Independence: Expression of opinion is a prime duty of an auditor. An influenced and biased person cannot form an independent opinion. Hence, independence in true sense is an utmost quality of an auditor. 3.Honesty and Integrity: Like any other professional viz. Doctors, Lawyers etc. auditor should possess a high moral character. In a way, he is a public servant. He must not knowingly, misinterpret any fact or sign any document under undue pressure.4. Objectivity: Independence of an auditor depends on his ability to act with objectivity. For example, the auditor of XYZ Company believes that closing stock has not been properly valued but accepts a certificate from the management as to its valuation. In this case, the auditors judgment lacks objectivity. 5.Communication: He should be able to communicate effectively, both orally and in writing. Particularly in the matter of report writing, he should be able to convey his message clearly and unambiguously. 6.Tactfulness: He should be firm, yet diplomatic with his client and staff. He should be tactful enough to obtain necessary written as well as oral evidence from his client, so that he can form a reasonable opinion. 7.Awareness of latest developments: An auditor should keep his knowledge up to date related to his audit work likes changes in laws, changes in professional standards, latest development in technical guidelines etc.
Q.2 What is social audit? Is social audit taken seriously by the corporate world? Give examples of corporates undertaking social audit. Q.3 Explain the Code of Ethics for Internal Auditor. Explain them in context with blacklisting Price Waterhouse Coopers in Satyam Scam. Q.4 As a senior audit assistant of M/s. Asutosh Associates, you are in charge of internal audit team of M/s Rajesh Technologies involved in the manufacture of plastic tubes. From the information you obtained you find the company is facing liquidity problem for the last two years. You are required to prepare working paper indicating the internal audit problems you would expect to face and how you plan to overcome them. Q.5 Explain the use of Sampling technique in Internal audit [SA500]

Q.6 What factors influence the internal control environment? Give examples for each factor. August/Fall 2012 Master of Business Administration - MBA Semester 3 Subject Code MF0013 Subject Name Internal Audit and Control 4 Credits (Book ID: B1211) Assignment Set- 2 (60 Marks) Note: Each question carries 10 Marks. Answer all the questions. Q.1 Why Internal check in necessary? Choose an organization of your choice and find out how internal checks are put in place. Q.2 Detail the specific problems of electronic data process relating to Internal control Q.3 Explain the principal considerations in internal control on: a. Purchases and creditors b. Fixed assets Q.4 Explain the steps of evaluating internal control system using flow chart Q.5 Lehman Brothers Holding filed for Chapter 11 bankruptcy protection following the massive exodus of most of its clients, drastic losses in its stock and devaluation of its assets. In context with this case, examine internal control and risk assessment system. Q.6 Explain the importance of working papers

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