Acme Tires Ltd. You are an IT audit senior employed by Olsen & Abrams, Chartered Public Accountants (CPAs). You have been asked to provide an assessment of control risk for the audit of the fina 1


Acme Tires Ltd.

You are an IT audit important employed by Olsen & Abrams, Chartered Generally-known Accountants (CPAs). You entertain been asked to contribute an impost of govern destroy for the audit of the financial statements of Acme Tires Ltd. and to realize any attached audit procedures balance the foregoing year that jurisdiction be required. For govern weaknesses that are to be reputed to skill, you entertain been asked to contribute recommendations for advancement.

Acme is a air-tight held special assembly, after a while its contiguous fiscal year ended September 30, 2019. Acme parts automobile and traffic tires from uninfallible manufacturers balance Canada. Acme has been an audit client of your attached for diverse years and has traditionally been advantageous, although net allowance this year has dropped by environing 15%.

Based on your criticism of the started papers (including uninfallible memoranda and criticism notes free by the audit staff and the agreement colleague) and the proposed financial statements and audit impression, you entertain noted the subjoined issues that entertain arisen during the gone-by year:

1.   Acme has five very-much automated countryal disposal capitals that part to hundreds of persomal sellers of tires. Each countryal capital to-boot has ―depot sale daysǁ when the depot is unreserved to the generally-known, which can forfeiture infallible tires that Acme is having misery selling to retailers at discounted prices. Acme has increased the quantity of the depot sale days to three days integral two weeks. Because of staff cutbacks, it is the identical two employees that run this sale and conduct the list for the sale.

2.   Acme’s crisis duty is in Vancouver. The assembly’s notice technology outsourcers, who preserve the new detain website implemented this year and aid Acme’s software, are to-boot located in Vancouver. Acme’s detain website has a customer gateway that is used by multifarious customers to arrange products, detail the foothold of an arrange, and to use belief cards to pay for their forfeiture online.

3.   Acme has the identical accounting software parcel tail implemented at lewd of its five disposal capitals. The fifth capital, Halifax, implemented a contrariant accounting software parcel tail this year, using its unhindered budget, since it wanted to subject costs in the accounting duty. The countryal conductr stated that the software prevailing by crisis duty is too troublesome to use.

4.   Since there entertain been no greater notice systems acquisitions for diverse years, and none are contrived, Acme disbanded its IT Steering Committee environing three years ago. At that age, the committee had high some greater exertion commendatory updates to the assembly’s retirement policies, pawn policies, employee notice systems practices,

disaster retrieval plans, and long-term notice systems strategies. Discussion after a while the CEO indicates that the assembly believes it conquer be needful to re-activate the committee in three to lewd years.

5.   Each country has a persomal area netexertion that includes two point-of-sale terminals (used for balance-the contrary sales and the depot sale days) and environing 15 other stations.

6.   Because of plummeting sales and revenues, the assembly has qualified its benefit contracts so that on-site subsistence of computing equipment is effected quarterly rather than monthly. Some functions, such as anti-virus updates are automated. However, there was a quantity after a while the Halifax network, and the Vancouver important accountant complained that he has of-late ordinary virus-infected spreadsheets from Halifax.

7.   Payroll is handled using a honorable benefit construction that has thousands of accounts. The important accountant in Vancouver is legitimate for payroll postulates beginning.


a)      Decipher five (5) IT govern weaknesses that are to be reputed to skill, contribute recommendations to skill for advancement, and realize the collision on the audit. Realize any attached audit procedures balance the foregoing year that jurisdiction be required.

IT Govern Weakness

Impact on the Audit

Recommendations to Skill for


Additional Audit Procedures

b)      Contribute an balanceall impost of the IT govern destroy at Acme Tires Ltd. Aid your response after a while operative reasons

c)       Realize and decipher matters that interest the audit mode in the future year.

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