Audit and Assurance Capital Expenditure Committee

Question: Discuss about the Audit and Assurance for Capital Expenditure Committee. Answer: Auditor of Audit Limited is required to perform following test of control in order to assess the operative efficiency of non-current assets: Capital expenditure committee: Observation can be applied by the auditor to observe a business process in action. In this manner, the viability of transaction can be assessed to assure that funds are utilised in right projects after having sanctioned by authorised person (Boyle and Lloyd, 2013). Recording of asset- For this aspect test of Information Processing and Physical evaluation will be applied by auditors. By use of these test of controls, written information will be checked with the physical presence of assets. For this purpose, counting will be done in records as well as physically. Further, the randomly serial number will be checked to match the corresponding assets. Good received a note: Test of Performance Reviews will be applied for the audit of this transaction to check entire process and its viability. With this method, appropriate comments can be provided by the auditor. Periodical internal audit: For this operational activity, Segregation of Duties will be applied to check that evaluating authority is not a person in charge (William Jr, Glover and Prawitt, 2016). Further, criteria and viability of audit will be checked to determine the extent of reliance on work of internal auditors. Access to non-current assets: For this transaction test of Authorisation will be applied to check the action of senior authority regarding approval of the entire process. With this auditor can assure that authorised parties are not in a position to make misuse of assets. By applying above described test of controls, auditor of Audit Limited can assess the operative efficiency of non-current assets. References Boyle, E.J. Lloyd, S., (2013). Writing Audit Programs For Tests of Controls: A Practice-Based Pedagogical Approach. The Accounting Educators' Journal, 23. William Jr, M., Glover, S. Prawitt, D., (2016). Auditing and assurance services: A systematic approach. McGraw-Hill Education.