Question

Create a scenario where external auditors determined that a company's internal controls were deficient, but such a deficiency might not mean that a material weakness existed. Ascertain the impact on the audit plan if additional deficiencies are discovered on other related internal controls. Support your position.

Answer 1

The external auditors determined that a company’s internal controls. The company invested the automatic inventory posting system by weighted average cost for raw materials. Standard cost for finished goods and obsolesce where the external auditors that company internal control process is low. The analysis of top 20 high consumption inventory items. The mechanism is perfectly designed and unless the data is error. Market value test for the slow moving and highly price volatile. The sum of control deficiencies in finished goods inventory valuation for the month end closing found.