Question 1 The CAE for Bangi Property reports administratively to the CFO and fu

Question

Question 1 The CAE for Bangi Property reports administratively to the CFO and functionally to audit committee The scope of the internal audit function assurance services includes financial, operational and compliance engagements. Is the internal auditors' objectivity regarding accounting-related matters impaired in each of the situation describe below? Briefly explain your answer. 1. The internal auditors are frequently asked to make accounting entries for complex transactions that the company's accountant do not have the expertise to handle. A staff accountant reconciles the company's monthly bank statements. An internal auditor reviews the bank reconciliations to make sure they are completed properly. 2.

Explanation / Answer

1. The internal auditors' objectivity is impaired in the current situation because the main objective of internal audit function is to review the functionality/ effectiveness of different process or any specific department. In the present case since the internal auditors are asked to make the accounting entries is against the golden rule of maker and checker, which is the main weapon used to derive the effectiveness and completeness of a transaction.
2.The objectivity of the internal audit function is not impaired in the current situation. The staff accountant reconciles the monthly bank statement and the same is being reviewed by the internal auditors which defines the checker function of the internal audit function.1. The internal auditors' objectivity is impaired in the current situation because the main objective of internal audit function is to review the functionality/ effectiveness of different process or any specific department. In the present case since the internal auditors are asked to make the accounting entries is against the golden rule of maker and checker, which is the main weapon used to derive the effectiveness and completeness of a transaction.

2.The objectivity of the internal audit function is not impaired in the current situation. The staff accountant reconciles the monthly bank statement and the same is being reviewed by the internal auditors which defines the checker function of the internal audit function.1. The internal auditors' objectivity is impaired in the current situation because the main objective of internal audit function is to review the functionality/ effectiveness of different process or any specific department. In the present case since the internal auditors are asked to make the accounting entries is against the golden rule of maker and checker, which is the main weapon used to derive the effectiveness and completeness of a transaction.

2.The objectivity of the internal audit function is not impaired in the current situation. The staff accountant reconciles the monthly bank statement and the same is being reviewed by the internal auditors which defines the checker function of the internal audit function.1. The internal auditors' objectivity is impaired in the current situation because the main objective of internal audit function is to review the functionality/ effectiveness of different process or any specific department. In the present case since the internal auditors are asked to make the accounting entries is against the golden rule of maker and checker, which is the main weapon used to derive the effectiveness and completeness of a transaction.
2.The objectivity of the internal audit function is not impaired in the current situation. The staff accountant reconciles the monthly bank statement and the same is being reviewed by the internal auditors which defines the checker function of the internal audit function.

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