OPQ Audit Firm Was Planning the Audit for Its Existing

question 27

Essay

OPQ Audit Firm was planning the audit for its existing client, Alpha & Beta Corp. The audit partner was trying to determine the best audit strategy to use. Alpha & Beta Corp. is a small retailing company that does not have any warehousing facilities as all stock is kept on the premises. Being small, they only have a small team of staff, which makes the separation of duties principle difficult to achieve. The preliminary tests of controls found that the internal control procedures are well designed, but not always observed due to the small amount of staff. Previous experience with this client also showed that controls were not always observed. Despite this, OPQ has never discovered a material misstatement in the accounts.
Required: Determine what audit strategy should be used and justify your answer.

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Definitions:

Define Slack

The amount of time that a task in a project schedule can be delayed without causing a delay to subsequent tasks or the project completion date.

Ethical Issues

Moral challenges affecting decisions and actions in personal and professional settings.

Project Managers

Project managers are professionals responsible for planning, executing, and closing projects, overseeing teams, resources, and scope to achieve project objectives.

Critical Path

A method used in project management to identify the longest sequence of dependent tasks that determine the shortest possible duration to complete the project.