SOC 103 Chapter Notes - Chapter 3: Internal Audit, Management
20 Dec 2016
School
Department
Course
Professor
Document Summary
Communicated informally only to management of the cash disbursement process. Observation would still be formally communicated to senior management and the audit committee in addition to management of the cash disbursements process. All observations must be written to include specific information that must be communicated about them regardless of what form of communication is indicated as a result of performing the observation evaluation and escalation process described above. Criteria, condition, cause and effect all must be included for each observation communicated. Engagement observations are items that have come to the attention of the internal audit function that can influence management"s assertions on the design adequacy and/ or operating effectiveness of controls. Internal audit function makes recommendations to provide the auditee with guidance on appropriate ways to resolve the observation and enhance either the design/ operation of the controls. Practice advisory 2410-1: communication criteria provides more details relative to the elements that must be contained in each engagement observation when communicated.
