ACC411 MilestoneTwo Guidelines and Rubric
Instructions
To complete this assignment, review the prompt and grading rubric in the Milestone Two Guidelines and Rubric PDF document. When you have finished your work, submit the assignment here for grading and instructor feedback.
ACC 411 Milestone Two Guidelines and Rubric
Overview: Careful planning is a critical part of the success of every audit. However, planning is not simply done at the beginning of the audit but is a continuous and iterative process in which the results of one stage of the audit often necessitate revisions to plans for the next stage.
Prompt: Using your analysis of the business environment of RNS from Milestone One, as well as your textbook reading on planning an audit of cash accounts, write an audit program (plan) that could be used to evaluate RNS’s internal controls for cash. Be sure your program addresses each component of internal control.
Specifically, the following critical elements must be addressed:
I. Write an audit program for internal control of cash in Word or Excel. The following components must be included: A. Control environment B. Risk assessment C. Control activities D. Information and communication E. Monitoring
Rubric
Guidelines for Submission: You can submit your audit program using Microsoft Word or Excel.
Critical Elements Proficient (100%) Needs Improvement (75%) Not Evident (0%) Value
Audit Program: Control Environment
Writes an audit program that effectively and completely addresses the control environment component of internal control of cash
Writes an audit program for the control environment component of internal control of cash, but the program is inappropriate, incomplete, or unclear
Does not write an audit program for the control environment component of internal control of cash
18
Audit Program: Risk Assessment
Writes an audit program that effectively and completely addresses the risk assessment component of internal control of cash
Writes an audit program for the risk assessment component of the internal control of cash, but the program is inappropriate, incomplete, or unclear
Does not write an audit program for the risk assessment component of internal control of cash
18
Audit Program: Control Activities
Writes an audit program that effectively and completely addresses the control activities component of internal control of cash
Writes an audit program that addresses the control activities component of internal control of cash, but the program is inappropriate, incomplete, or unclear
Does not write an audit program that addresses the control activities component of the internal control of cash
18
Critical Elements Proficient (100%) Needs Improvement (75%) Not Evident (0%) Value
Audit Program: Information and Communication
Writes an audit program that effectively and completely addresses the information and communication component of internal control of cash
Writes an audit program that addresses the information and communication component of the internal control of cash, but the program is inappropriate, incomplete, or unclear
Does not write a program that addresses the information and communication component of the internal control of cash
18
Audit Program: Monitoring
Writes an audit program that completely and effectively addresses the monitoring component of internal control of cash
Writes an audit program that addresses the monitoring component of internal control of cash, but the program is inappropriate, incomplete, or unclear
Does not write a program to address the monitoring component of the internal control of cash
18
Articulation of Response
Submission has no major errors related to citations, grammar, spelling, syntax, or organization
Submission has major errors related to citations, grammar, spelling, syntax, or organization that negatively impact readability and articulation of main ideas
Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas
10
Total 100%
,
1
Milestone One
Zachary Higgs
Southern New Hampshire University
ACC-411-R1480 Auditing Principles 22EW1
September 18, 2022
To: Robbins Network Services (RNS)
From: Auditor
Subject: Audit Plan
Date: September 18, 2022
The Financial Business Transactions
RBN (Robbins Network Solutions) operates in the Information Technology industry, and it specializes in the selling and installation of computer software and hardware. It also functions to provide consultation services for businesses that are in the same industry. In the current space, the company is building its computer networking software that it can ultimately sell to its present and potential customers (Whittington & Pany, 2019). In selling computer software and hardware, RNS is engaging in financial transactions that come by because of the exchange of goods and money between the parties. The company will also engage in financial transactions with its customers when it starts selling the new computer software to its customers who are existent and the new ones (Whittington & Pany, 2019). The proof of the financial transactions is the receipts that RNS produces when a customer purchases software or hardware from them. Payments usually decrease the account payable accounts of the company by the total supplier amount paid out.
The Highest Business Risks
Business risks define the factors that result in the loss of profits in a business venture and its environment. RNS faces a huge business risk that originates from the projected decline in spending from the United States government in the coming future. Competitors can also take advantage of predatory pricing, which can neutralize the strength that RNS has in the industry. Credit losses that come from sale of goods to different customers also bear a big risk for the company. An increase in the company’s expenditure on advertising might not be a great move because the new software is bound to face a myriad of challenges in the market (Whittington & Pany, 2019). The highlighted problem is the company’s highest business risk because it inhibits the company from reaching its financial objectives. The company is bound towards constrained financial strength and growth with the reduction in demand for services, resources, and equipment in the Information Technology industry. Credit losses are also an area that the company can lose a lot of revenue because of untrustworthy customers that pose high business risks.
Types of Internal Controls
The internal controls that can optimize the functioning of RNS are preventive, corrective, and directive controls. Preventive measures are critical in ensuring that the company inhibits the occurrence of financial misstatements. The measures will also guarantee that the company maintains duplicates of the most important transactions (Whittington & Pany, 2019). Subsequently, it will document the errors committed to ensure that corrections are duly done to eliminate the errors. The company should also be in a prime position to execute the delegation of duties to hinder any fraudulent activities targeting the company’s information (Whittington & Pany, 2019). The department that develops the software should be different from the one that inspects the software. It will help the company in producing products or services that are devoid of defects.
Ethical Issue
The ethical issues that RNS can face during its operations are manifold. Lack of ethics exemplified by the misuse of the company’s computers is one of the principal issues. It would mean that the financial audit centralizes its work on informing the stakeholders, stockholders, and investors to understand this breach of ethics (Gotterbarn, 2022). RNS should avoid ethical issues associated with the sale of sub-standard software. The company should sell the software after it has undergone thorough testing and examination to determine its consistency by removing all forms of errors identified (Gotterbarn, 2022). The financial auditor should communicate to the board and all stakeholders that the software is not assessed enough to ascertain its effectiveness to release it to the market. Professionalism is thereby expected at all the stages of evaluating the efficiency of the software to deal away with the possible errors.
Current Events
The modern technological space is experiencing ravaging advancement that has resulted in an augmented demand for different technological services. RNS stands a great chance of raking huge profits with the introduction of its software because the market is extensive, and this is occasioned by the technological innovations. The world economy has become digitalized with different job opportunities sprouting due to the convenience that technology have created in the present world (Whittington & Pany, 2019). RNS must, therefore, focus its functioning into enhancing its software development processes to acquire modernity and qualities that can compete with the competitors in the Information Technology industry. It is important for RNS to do this because this is what will give the company a higher competitive advantage than other companies.
References
Gotterbarn, D. (2022). SOFTWARE ENGINEERING ETHICS. Encyclopedia of Software Engineering. Retrieved 17 September 2022, from https://www.uio.no/studier/emner/matnat/ifi/INF3700/v12/undervisningsmateriale/Softw are%20engeneering%20ethics.pdf.
Whittington, R., & Pany, K. (2019). Principles of Auditing and Other Assurance Services. New York: McGraw-Hill Education.
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