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pretion Status 2 3 4 5 6 9 10 11 12 Question 13 14 15 10 17 16 19 20 The EnTaRe charity was established in 1960. The charity's aim is to provide support to children from disadvantaged backgrounds who wish to take part in sports such as tenis, Spots badminton and football, EnTaRe has a detailed constitution which explains how the charity's income can be spent. The constitution to note that action expenditure cannot 10o come in any year. The charity's income is derived wholly from voluntary donations. Sources of donations include: Cash collected by volunteers asking the public for donations in shopping ateas. () Cheques sent to the charity's head office, (1) Donations from generous individuals. Some of these donations have specific clauses attached to them indicating that the initial amount donated capital cannot be spent and than the income interest) from the donation must be spent on specific activities, for example, provision of sports equipment The rules regarding the taxation of charities in the country EnTaRe is based are complicated, with only certain expenditure being allowable for taxation purposes and donations of capital being treated as income in some situations. (a) Determine the 'audit risk' and the three elements of risk that contribute to total audit risk. Arial 3 (12pt) T - - E 25 Question 19 10 12 Bonsal Trading Co (Bonsall manufactures electrical equipment and its year end is 30 September 2015. You are the programmes for the forthcoming interim audit. The company's internal audit department has provide you with documentong to the center related controls listed below - Bonsal has a capital expenditure committee and all purchase orders for tapital items are required to be authorised by this com -On receipt, each asset is assigned a unique serial number and this is recorded on the asset and in the noncurrent rester - When the asset arrives, a goods received note (GRN) is completed which details the nature of the expenditure whether it is clear eviewed and initialled by a responsible official. Copies of the GRNs relating to capital expenditure are then submitted to the financiergartment or new egister Periodically, internal audit undertakes a review of assets in the register and compares them to assets on site, using the serial number to confirmance of the we access to the non-current assets register is restricted through passwords to a small number of staff in the finance department, 15 Identifying and Assessing the Risks of Material Misstatement through Understanding the entity and its Environment describes the five components of an entry's immer red: Identify and briefly explain the FIVE components of an entity's internal control. T Arial 3 (12pt) T- JE - FS F4 Remaining Time: 1 hour, 23 minutes, 14 seconds Question completion Status 12 13 11 15 17 13 9 Question 14 Clapstick Co operates a chain of hotels across the country. Clapstick Co employs in excess of 250 permanent employees and year end 20. You were won. ADATLAR of Viola & Co and are currently reviewing the documentation of Clapstick Co's payroll system, detailed below, in preparation for the interim audit Clapstick Co's payroll system Permanent employees work a standard number of hours per week as specified in their employment contract. However, when the hotels are busy can be red by management to work additional shifts as overtime. This can either be paid on a monthly basis or taken as days off Employees record any overtime worked and days taken off on weekly overtime sheets which are sent to the payroll department. The standard hours per employee we wtomatically up in the system and the overtime sheets are entered by clerks into the payroll package, which automatically calculates the gross and repayong with reductions. The calculations are not checked at all. Wages are increased by the rate of inflation each year and the clerks are responsible for updating the standing data in the payroll Employees are paid on a monthly basis by bank transfer for their contracted weekly hours and for any overtime worked in the previous month. If employees thoose to be paid for overtime, authorisation is required by department heads of any overtime in excess of 30% of standard hours. If employees choose instead to the days of the payroleris check back to the 'overtime worked report; however, this report is not always checked. The 'overtime worked' report, which details any overtime recorded by employees, is run by the payroll department weekly and emailed to department heads for authors. The payroll department asks department heads to only report if there are any errors recorded. Department heads are required to arrange for overtime sheets to be authorised by an alternative responsible official if they are away on annual leave; however, there are instances where this arrangement has not occurred. The payroll package produces a list of payments per employee; this links into the bank system to produce a list of automatic payments. The finance director redes the total list of a transfers and compares this to the total amount to be paid per the payroll records if any issues arise then the automatic bank transfer can be manually changed by the tante dires In respect of the payroll system of Clapstick Co: (1) Determine and explain FIVE threats to Control risk; (11) Recommend a control to address each of these threats: TTT Arial 3 (12pt) TE-E

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