Question

In: Accounting

JBM Catering and Hire provides a full catering service to mostly commercial businesses, that includes both...

JBM Catering and Hire provides a full catering service to mostly commercial businesses, that includes both the preparation of specialised menus and the hire of relevant catering supplies (crockery, cutlery, table linen and décor items) and equipment (such as tables, chairs, and servers). You have been assigned to the audit of JBM Limited for the current year. During the planning stage of the audit you have identified the following significant risks: a) Accounts payable. JBM has a large number of suppliers for various catering supplies and equipment. Paying the supplier twice for the same purchase has been an ongoing problem. b) Payroll expense. JBM employs a large number of casual staff to assist with waitering, cleaning and packing for the catered events. These events often take place over weekends and at night, with some events requiring overtime hours being worked. There have been frequent occurrences of standard weekend and night shifts being paid at overtime rates. Required: For each of the accounts for JBM Catering & Hire (1 and 2 above) identified to be a significant risk: 1. Determine the key assertion at risk. 2. Describe a practical prevent internal control that would directly address the risk. 3. Describe a test that you would perform to assess whether the control was functioning correctly. Prepare a table as shown below to complete your answers to this question. Account at risk a) Accounts payable b) Payroll expense a. Key assertion at risk b. Prevent internal control c. Test of control

Solutions

Expert Solution


Related Solutions

JBM Catering and Hire provides a full catering service to mostly commercial businesses, that includes both...
JBM Catering and Hire provides a full catering service to mostly commercial businesses, that includes both the preparation of specialised menus and the hire of relevant catering supplies (crockery, cutlery, table linen and décor items) and equipment (such as tables, chairs, and servers). You have been assigned to the audit of JBM Limited for the current year. During the planning stage of the audit you have identified the following significant risks: a) Accounts payable. JBM has a large number of...
The Shamrock Pub provides catering services to local businesses. The following information was available for The...
The Shamrock Pub provides catering services to local businesses. The following information was available for The Shamrock Pub for the years ended December 31, 2019 and 2020. December 31, 2019 December 31, 2020 Cash $ 2,180 $ 1,680 Accounts receivable 46,500 ? Allowance for doubtful accounts 530 ? Other current assets 8,230 7,930 Current liabilities 38,300 44,700 Total credit sales 201,000 257,000 Collections on accounts receivable 193,000 230,000 Shamrock management is preparing for a meeting with its bank concerning renewal...
Anthony Bourdain owns an international catering service that provides food and beverages at exclusive parties and...
Anthony Bourdain owns an international catering service that provides food and beverages at exclusive parties and business events. Bourdain’s business is seasonal, with a heavy schedule during the summer months and holidays and a lighter schedule at other times. One of the major events that Bourdain’s customers request is a cocktail party. He offers a standard cocktail party and has estimated the cost per quest for this party as follows: Food and beverages $17.00 Labor (.50 hours @ $10.00/hour)     5.00...
A service station has both self-service and full-service islands. On each island, there is a single...
A service station has both self-service and full-service islands. On each island, there is a single regular unleaded pump with two hoses. Let X denote the number of hoses being used on the self-service island at a particular time, and let Y denote the number of hoses on the full-service island in use at that time. The joint pmf of X and Y appears in the accompanying tabulation. y p(x, y) 0 1 2 x 0 0.10 0.05 0.02 1...
A service station has both self-service and full-service islands. On each island, there is a single...
A service station has both self-service and full-service islands. On each island, there is a single regular unleaded pump with two hoses. Let X denote the number of hoses being used on the self-service island at a particular time, and let Y denote the number of hoses on the full-service island in use at that time. The joint pmf of X and Y appears in the accompanying tabulation. y p(x, y)      0 1 2 x 0     0.10     0.03     0.01  ...
A service station has both self-service and full-service islands. On each island, there is a single...
A service station has both self-service and full-service islands. On each island, there is a single regular unleaded pump with two hoses. Let X denote the number of hoses being used on the self-service island at a particular time, and let Y denote the number of hoses on the full-service island in use at that time. The joint pmf of X and Y appears in the accompanying tabulation. y p(x, y)      0 1 2 x 0     0.10     0.05     0.02  ...
1. A service station has both self-service and full-service islands. On each island, there is a...
1. A service station has both self-service and full-service islands. On each island, there is a single regular unleaded pump with two hoses. Let X denote the number of hoses being used on the self-service island at a par- ticular time, and let Y denote the number of hoses on the full service island in use that time. The joint pmf of X and Y appears in the accompanying tabulation. 0 1 2 0 .10 .04 .02 1 .08 .20...
A service station has both self-service and full-service islands. On each island, there is a single...
A service station has both self-service and full-service islands. On each island, there is a single regular unleaded pump with two hoses. Let X denote the number of hoses being used on the self-service island at a particular time, and let Y denote the number of hoses on the full-service island in use at that time. The joint pmf of X and Y appears in the accompanying tabulation. y p(x, y)      0 1 2 x 0     0.10     0.05     0.01  ...
A service station has both self-service and full-service islands. On each island, there is a single...
A service station has both self-service and full-service islands. On each island, there is a single regular unleaded pump with two hoses. Let X denote the number of hoses being used on the self-service island at a particular time, and let Y denote the number of hoses on the full-service island in use at that time. The joint pmf of X and Y appears in the accompanying tabulation. P(x,y) y x 0 1 2 0 0.06 0.14 0.02 1 0.03...
Pacific Bank provides loans to businesses in the community through its Commercial Lending Department. Small loans...
Pacific Bank provides loans to businesses in the community through its Commercial Lending Department. Small loans (less than $100,000) may be approved by an individual loan officer, while larger loans (greater than $100,000) must be approved by a board of loan officers. Once a loan is approved, the funds are made available to the loan applicant under agreed-upon terms. Pacific Bank has instituted a policy whereby its president has the individual authority to approve loans up to $5,000,000. The president...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT