An Audit of an Organization's Fulfillment Department Discovered That Problems

question 233

Multiple Choice

An audit of an organization's fulfillment department discovered that problems in the order processing system led to a significant number of orders being fulfilled multiple times. During the exit conference, the head of the department informed the auditors that the processing system would be enhanced within six months to correct the problems. Which course of action should the chief audit executive follow?

• A) Adjust the scope of the next scheduled audit to determine that the problems have been resolved.
• B) Monitor the status of corrective action and schedule a follow-up engagement when appropriate.
• C) Meet with the audit committee to determine the appropriate follow-up action.
• D) Assess the status of corrective action in a follow-up engagement in six months.

---

Definitions:

Effective Interest Amortization

Effective Interest Amortization is a method of calculating the amortization of a bond's premium or discount, taking into account the time value of money.

Interest Accrual

The accumulation of interest on a loan or investment over time, which has been earned but not yet paid.

Common Stock Warrants

Certificates granting the holder the right to purchase common stock at a specified price within a certain period of time.