Auditing and Assurance revision question and answer

Auditing and Assurance Revision Questions and Answers

Nepal Engineers Association organized a three three-day national Conference of Engineers in Kathmandu. You are asked to audit the accounts of the conference. Draft the audit program for audit of receipt of participation fees from delegates to the conference. Mention any six point, peculiar to the situation, which you will like to include in your audit program.

Answer
The organization of three-day International conference of Engineers in Kathmandu Nepal Engineers Association is a one- time event. Normally, in view of mega-size of the event, organizing committee is formed in the organization to handle the entire event. Since few people would be handling the event, the

internal control may not be that strong and, thus, more emphasis is required to be given on substantive procedure.

Following are the areas for consideration:
i. Internal Control System
a. Examine the organization structure of organizing committee formed for the International conference if any, and division of responsibilities amongst persons and control custody over receipt books.
b. Verify the internal control system for restricting the participation of unregistered delegates.

ii. Rate of Participation Fees
a. Verify with reference to resolution passed the organizing committee/Nepal Engineers Association.
b. Also verify the rate from the literature/registration form circulated for promotion of conference.

iii. Receipts of Participation Fees
a. Verify counterfoil of the receipts issued for individual registration.
b. Ensure that receipts are issued for all the registration received in cash.
c. Trace the receipts in bank statement or cash book as the case may be.
d. Verify Bank Reconciliation statement and list out dishonored cheques.
e. Verify subsequent recovery in respect of dishonored cheques.

iv. Overall checking
a. Verify the total receipt of participation fees shown in the financial statements with reference to total number of receipts issued to participants.
b. Cross check the total number of delegates with reference to the following:
1. Kits distributed to participants.
2. Bills of Hotel/caterer for providing meals during conference.
3. Capacity of the Hall
4. Participation Certificate if any issued.

v. Foreign Delegates
In case of foreign delegates – if registration fees are higher – ensure that they are registered at higher fees.

vi. Special Issues
a. Take out list of absentees and in case of nil absentees, probe the issue further.

b. If certain participants are exempted from payment of fees – obtain the list along with proper authorization in this regard.



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