You are the audit senior assigned to the audit of TeleBuz Limited (TeleBuz), an airtime wholesale company based in Johannesburg

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You are the audit senior assigned to the audit of TeleBuz Limited (TeleBuz), an airtime wholesale company based in Johannesburg. You obtain an understanding of the process followed by the company regarding its financing cycle. TeleBuz purchases airtime in bulk from the different network providers in South Africa and also purchases printing paper in bulk upon which its clients print their airtime vouchers. Based on tendering for a contract, TeleBuz entered into another contract to purchase specialised machines that it could place in malls and service stations to sell its prepaid airtime. TeleBuz was not awarded the contract. As this was a specialised order, TeleBuz is investigating its obligation has not disclosed anything in the financial statements. Which one of the following best describes the major risk arising from the non-disclosure? terms of the contract and A. This can be considered fraudulent financial reporting as TeleBuz is omitting long-term liabilities. OB. This can be considered fraudulent financial reporting as TeleBuz is omitting a possible contingent liability. OC. This can be considered fraudulent financial reporting as TeleBuz is omitting a provision for an onerous contract. OD. This can be considered fraudulent financial reporting as TeleBuz is undervaluing long-term liabilities. Reset Selection Question 8 of 30 Hypermania (Pty) Ltd maintains perpetual inventory records. Which one of the following alternatives indicate controls to ensure that inventory do exist? 1) Steps to identify obsolete inventory 2) Physical safeguards to protect inventory from theft 3) Numbering of goods delivery notes 4) Reconciliation of inventory records to results of inventory counts A. 1 & 2 are control activities to ensure that inventory do exist B. 2 & 3 are control activities to ensure that inventory do exist OC. 1 & 3 are control activities to ensure that inventory do exist D. 2 & 4 are control activities to ensure that inventory do exist. Reset Selection Question of 30 2 Points Choose the option that correctly relates to the internal audit function in terms of the King IV Report on Governance. (Please note there could be more than one correct alternative.) Select all the correct alternatives. A. it is part of a company's combined assurance model B. it is part of performing an assessment of the effectiveness of risk management. C. it is in a listed company, usually a section of the financial accounting department D. it is an extension of the external audit function. E. it is part of monitoring a company's risk management. Question 10 of 30 2 Points Which of the undermentioned control activities would help to ensure that the following risk will be addressed in a computerised environment? Quantities on authorised picking slips are not those transferred to the despatch bay. This risk may lead to possible misappropriation of inventory before despatched to customer. (Please note there could be more than one correct alternative.) Select all the correct alternatives. A. An exception report is printed from the system of any physical items missing or not recognised in terms of an automatic comparison with the details on the computerised picking slip stored on the system B. The despatch clerk uses a mobile scanning device linked to the computerised inventory system to scan the items as they are transferred into the despatch bay. C. The warehouse supervisor should review the exception report and remedial action should be taken if necessary. D. The despatch clerk signs the picking slip as proof of having taken custody of the items that were accepted.