How to Apply Porter's Five Forces to Discover Opportunities in P&G

Only available on StudyMode
  • Download(s) : 30
  • Published : April 2, 2013
Open Document
Text Preview
Audit Checklists & Continuous Auditing for Financial Close and Sarbanes-Oxley (SOX) Audit Procedures December 2006

This document provides a consolidated set of audit checklists typical of those used by internal and external auditors to evaluate the financial close process and test compliance with SarbanesOxley (SOX). These checklists identify all of the typical controls that comprise a typical audit and highlight ways that you can automate many of the tasks by using an independent controls monitoring and audit (CMA) solution.

Table of Contents
Section 1 – Financial Close Process ......................................................................................... 3 Section 2 – Entity Level Controls - Control Environment ........................................................... 5 Section 3 – Entity Level Controls - Information & Communication............................................. 8 Section 4 – Entity Level Controls – Monitoring ........................................................................ 10 Section 5 – Entity Level Controls – Risk Assessment ............................................................. 12 Section 6 – Expenditure Process Controls .............................................................................. 12 Section 7 – Fixed Assets Process Controls ............................................................................. 17 Section 8 – Inventory Management Process Controls ............................................................. 19 Section 9 – Payroll Process Controls ...................................................................................... 22 Section 10 – Revenue Process Controls ................................................................................. 24 Section 11 – Treasury Process Controls ................................................................................. 27 Section 12 – SOX Checklist..................................................................................................... 30 ABOUT APPROVA .................................................................................................................. 34

Audit Checklists & Continuous Auditing for Financial Close and Sarbanes-Oxley (SOX) Audit Procedures

2

Section 1 – Financial Close Process
The financial close process is the single largest source of internal controls weaknesses disclosed in SEC filings. Some of the most common challenges include revenue recognition, accruals, capitalization, and inter-company eliminations. For this reason it is typically a major focus of most audits. The following checklist highlights the key controls that auditors test and indicate where there are opportunities to automate processes as part of a continuous audit process.

Checklist #1: Financial Close Process
Business Activity 1 2 Financial Close Financial Close Financial Close Point of Focus/ Control Objective Accounting policies exist, are kept current, and are communicated to the appropriate personnel. Procedures are in place to ensure that all transactions are recorded in accordance with GAAP. Close procedures, including due dates, responsibilities, disclosure updates, and account classifications are defined, communicated, and implemented. Continuous controls monitoring and audit of the financial close process is an integral part of the financial close procedure. CMA solutions can report test results in existing corporate reports or as part of third party reporting packages (e.g. Crystal Reports). CMA solutions provide detailed remediation and monitoring of user access for accounting and reporting applications. CMA solutions monitor unauthorized or irregular journal entries. CMA solutions identify nonstandard journal entries. CMA solutions identify duplicate journal entries. CMA solutions identify manual journal entries that do not have proper approvals. Ability to Automate Description of Automation

3

4

Financial Close

The standard corporate...
tracking img