RGM Sdn Bhd (RGM) is involved in packaging palm oil which is then sold to supermarkets


RGM Sdn Bhd (RGM) is involved in packaging palm oil which is then sold to supermarkets. Raw materials mainly are boxes, plastic bottles and stickers used as its label. The company purchases its raw materials from a wide range of suppliers. Below is a description of RGM’s purchasing system.

Don't use plagiarized sources. Get Your Custom Essay on
RGM Sdn Bhd (RGM) is involved in packaging palm oil which is then sold to supermarkets
Just from $13/Page
Order Essay

When raw materials are required, the factory manager complete a requisition form and this is submitted to the purchasing department. No authorization is required on requisition forms and no reference is made to the current inventory levels of the materials being requested. A clerk in the purchasing department issues a sequentially numbered purchase order which is based on the previous supplier which the company purchased from. There is no approved supplier list.

Purchase orders are authorized by the purchasing director prior to being sent to the suppliers. When the goods are received, the warehouse department verifies the quantity to the suppliers despatch note and checks that the quality of the goods received are satisfactory. They complete a sequentially numbered goods received note (GRN) and send a copy of the GRN to the accounts department.

Purchase invoices are sent directly to the purchase ledger clerk, who stores them in a manual file until the end of each week. At the end of the week, he enters the invoice into the purchase ledger and gives each invoice a unique number based on the supplier code. The invoices are reviewed and authorised for payment by the accounts manager.Required:

  1. Explain why obtaining an understanding of the entity and its environment is important for the auditor. (5 marks)
  1. Describe TWO (2) methods for documenting purchasing system of RGM; and for each method explain the advantages and disadvantages of using this method. (6 marks)
  1. List FOUR (4) control objectives of RGM’s purchase system. (4 marks)
  1. In respect of the purchasing system of RGM:
    1. Identify and explain FIVE (5) weaknesses; and
    2. Recommend a control to address each of these weaknesses

(Note: Present answers using atableformat) (10 marks)

  1. Describe the roles of an audit committee and the benefits to companies of establishing an audit committee. (5 marks)
  1. Describe FIVE (5) audit procedures undertaken by an auditor to assess if an entity’s going concern assumption is reasonable (10 marks)

Page 2 of 6

Calculate your order
Pages (275 words)
Standard price: $0.00
Client Reviews
Our Guarantees
100% Confidentiality
Information about customers is confidential and never disclosed to third parties.
Original Writing
We complete all papers from scratch. You can get a plagiarism report.
Timely Delivery
No missed deadlines – 97% of assignments are completed in time.
Money Back
If you're confident that a writer didn't follow your order details, ask for a refund.

Calculate the price of your order

You will get a personal manager and a discount.
We'll send you the first draft for approval by at
Total price:
Power up Your Academic Success with the
Team of Professionals. We’ve Got Your Back.
Power up Your Study Success with Experts We’ve Got Your Back.
error: Content is protected !!
Live Chat+1(978) 822-0999EmailWhatsApp

Order your essay today and save 20% with the discount code GOODESSAY