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Winter-2014
Master of Business Administration- MBA Semester 4
MF0013Internal Audit and Control-4 Credits
(Book ID: 1733)
Assignment (60 Marks)
Note: Answer all questions (with 300 to 400 words each) must be
written within 6-8 pages. Each Question carries 10 marks 6 X 10=60
Q1. Define and explain the term auditing. Personal qualities of an
auditor are important for the successful conduct of audit. Comment
Answer: The general definition of an audit is an evaluation of a person,
organization, system, process, enterprise, project or product. The term most
commonly refers to audits in accounting, internal auditing, and government
auditing, but similar concepts also exist in project management, quality
management, water
Q2. Write the key objectives of a good internal audit system. Narrate
the points of dissimilarities between external audit and internal audit.
Answer: There are five possible objectives that an internal audit might have:
To determine whether controls over financial and operating data provide
managers with reasonable assurance that the financial and operating data
is accurate and reliable (i.e., that information gathering and reporting has
been properly planned, organized and directed);
To determine whether controls over compliance with policies, procedures,
plans, laws and regulations provide managers with reasonable assurance
that proper compliance actually
Q3. Give the role of internal auditor in the Companys Management. List
down the duties of auditor Under Section 581ZG.
Answer: Role of Internal Audit
What do Internal Auditors do?

The internal auditor is often described as the organizations critical friend the
independent advisor who can challenge current practice, champion best practice
and be a catalyst for improvement, with the objective of
Q4. The effectiveness of the internal control system can be ensured if
the important aspects of the companys operations are kept in mind.
Explain the characteristics of an effective internal control system. Write
the elements of internal control.
Answer: Characteristics of Effective Internal Control System
Control Environment
The control environment is the company's attitude toward internal controls.
Known as "tone-at-the-top," the control environment is a necessary condition for
effective internal control, because even the best-designed systems can be
thwarted if management overrides the controls that are in place. Indicators of an
effective control environment include having a whistleblower hotline or discipline
policies that take violations of internal control seriously. Management override of
controls or shortcuts are signs that the
Q5. Describe general EDP controls. Explain the appraisal of accounting
system and related internal control.
Answer: In an EDP system, the following problems arise in the implementation of
internal control:
a) Separation of duties:
In a manual system, separate individuals are responsible for initiating
transactions, recording transactions, and custody of assets. As a basic control,
separation of duties prevents of detects errors and irregularities.
Q6. Explain the internal control systems in insurance companies. Write
down about the reporting internal control weaknesses.
Answer: Internal control system in insurance
Insurance companies paid special attention to the internal control procedures
with regard to receipts and payments of cash and cherubs, acceptance of risks,
calculation of premiums, making of loans, buying and selling of investments,
payment of commission to agents, and to control over expenses of management.
An

Get solved assignments at nominal price of

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Mail us at: subjects4u@gmail.com or contact at

09857777350, 08894344452