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Wages mean a payment usually of money for labour or services according to contract and
A.hourly
B.daily
C.monthly
D.piecework
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A.hourly
B.daily
C.monthly
D.piecework
A.involved the payment of higher wages
B.required skill in:detailed tasks
C.was assumed to be less characterized by sex segregation
D.was more readily accepted by women than by men
Sales ordering, goods despatched and invoicing
Heraklion Co sells footballs to a range of large and small sports equipment retailers in several countries. Sales are made through a network of sales staff employed by Heraklion Co, but new customer leads are generated through a third party company. Sales staff are responsible for assessing new customers’ creditworthiness and proposing a credit limit which is then authorised by the sales director. The sales staff have monthly sales targets and are able to use their discretion in granting sales discounts up to a maximum of 10%. They then record any discount granted in the customer master data file.
The sales staff visit customer sites personally and orders are completed using a two-part pre-printed order form. One copy is left with the customer and the other copy is retained by the sales person. The sales order number is based on the sales person’s own identification (ID) number.
The company markets itself on being able to despatch all orders within three working days. Once the order is taken, the sales person emails the finance department and warehouse despatch team with the customer ID and the sales order details and from this a pick list is generated. Sequentially numbered goods despatched notes are completed and filed in the warehouse.
Sequentially numbered invoices are generated using the pick lists for quantities and the customer master data file for prices. Standard credit terms for customers are 30 days and on a monthly basis sales invoices which are over 90 days outstanding are notified to the relevant sales person to chase payment directly with the customer.
Payroll fraud
The finance director, Montse Mirabelle, has informed you that a significant fraud took place during the year in the payroll department. A number of fictitious employees were set up on the payroll and wages were paid into one bank account. This bank account belonged to two supervisors, who were married, and were employed by Heraklion Co. One had sole responsibility for setting up new joiners in the payroll system and the other processed and authorised bank transfer requests for wages and supplier payments. These employees no longer work for the company and Montse has asked the audit firm for recommendations on how to improve controls in this area to prevent this type of fraud occurring again. Heraklion Co operates a Human Resources department.
Required:
(a) Describe TWO methods for documenting the sales system, and for each explain ONE advantage and ONE disadvantage of using this method. (6 marks)
(b) Identify and explain SEVEN deficiencies in the sales system of Heraklion Co and provide a recommendation to address each of these deficiencies. Note: Prepare your answer using two columns headed Control deficiency and Control recommendation respectively. (14 marks)
(c) In relation to the payroll fraud, identify and explain THREE controls Heraklion Co should implement to reduce the risk of this type of fraud occurring again and, for each control, describe how it would mitigate the risk. (6 marks)
(d) Describe substantive procedures the auditor should perform. to obtain sufficient and appropriate audit evidence in relation to Heraklion Co’s revenue. (4 marks)
The same factors push wages and prices up together, the one ______ the other.
A.emphasizing
B.reinforcing
C.multiplying
D.increasing
Usually, cab drivers ______.
A.get high wages from the employer
B.get great benefits from the employer
C.get low wages from the employer
D.get high bonus from the employer
Which of the following is a substantive audit procedure for wages and salaries?
A.Inspect a sample of clock cards for evidence of authorisation by a responsible official
B.Recalculate a sample of payroll deductions such as employment taxes to confirm accuracy
C.Attempt to access and make changes to the payroll master file using the log on for a junior clerk
25 An example of coercive power would be:
A. Demotion
B. Reduction in wages
C. Disciplinary layoff
D. Reprimand
E. All of the above
(a) ISA 300 Planning an Audit of Financial Statements provides guidance to auditors. Planning an audit involves establishing the overall audit strategy for the engagement and developing an audit plan. Adequate planning benefits the audit of financial statements in several ways.
Required:
Explain the importance of audit planning. (5 marks)
(b) You are the audit senior in charge of the audit of Swandive Co (Swandive), and have been informed by your audit manager that during the year a fraud occurred at the client. A payroll clerk set up fictitious employees and the wages were paid into the clerk’s own bank account. This clerk has subsequently left the company, but the audit manager is concerned that additional frauds have taken place in the wages department.
Required:
Describe procedures which should be undertaken during the audit of wages as a result of the manager’s assessment of the increased risk of fraud. (5 marks)
What would happen if women's wages were raised?
A. The imput of labor would be increased.
B. The unemployment rate would go up.
C. Those who have jobs would all become better off.
D. Women as a group would earn more than before.
An example of coercive power would be:
A Demotion
B Reduction in wages
C Disciplinary layoff
D Reprimand
E All of the above