Kabura Industries a Company based in Sohar manufactures doors and windows. It has one operating site and a customer base spread across GCC. The company’s yearend was 31st December 2016.Below is the description of the purchasing system.
Purchasing system (Purchasing cycle)
Whenever production materials are required, the relevant department sends a requisitions form to the ordering department. An order clerk raises a purchase order and contacts a number of suppliers to see which can dispatch the goods first. This supplier is then choosen.The order clerk can send out the purchase order. This is not sequentially numbered and only the order above RO.10,000 require authorization.
Required:
Imagine currently you are working as the external auditors of Kaburaindustries company, :
a) Identify and explain any TWO deficiencies in the system, also explain the possible implication of each
deficiency.(4 marks Word Limit 60-80)
b) Provide a recommendation to address each deficiency identified above.(2 marks Word Limit 30-50)
c) Discuss any four general limitations of internal control in most of the organisations.(4 marks Word Limit 60-80
Sample Solution
