Apollo Shoes - Internal Controls Solution
ICC-1
Apollo Shoes, Inc.
Internal Control Questionnaire Sales Transaction Processing
December 31, 2007
Objectives and Questions Yes, No, N/A Comments
Environment:
1. Is the credit department independent of the sales department? Yes. Credit manager in Treasurer's office
2. Are sales of the following types controlled by the same procedures described below? Sales to employees, COD sales, disposals of property, cash sales and scrap sales. No available information, apparently not applicable
Existence Objective:
3. Is access to sales invoice blanks restricted? Yes. Kept in locked closet
4. Are prenumbered bills of lading or other shipping documents prepared or completed in the shipping department? Yes. Shipping department
Completeness Objective:
5. Are sales invoice blanks prenumbered? Yes
6. Is the sequence checked for missing invoices? No available information
7. Is the shipping document numerical sequence checked for missing bills of lading numbers? No available information
Valuation Objective:
8. Are all credit sales approved by the credit department prior to shipment? Yes. Credit manager file
9. Are sales prices and terms based on approved standards? Yes. Approved price file
10. Are returned sales credits and other credits supported by documentation as to receipt, condition, and quantity and approved by a responsible officer? No available information
Occurrence Objective:
11. Are shipped quantities compared to invoice quantities? Yes. Shipping department clerk
12. Are sales invoices checked for error in quantities, prices, extensions and footing, and freight allowances and checked with customers' orders? Yes. Accounts receivable clerk
13. Is there an overall check for errors in arithmetic accuracy of period sales data by a statistical or product-line analysis? Yes. Marketing vice president
14. Are periodic sales data reported directly to general ledger accounting independent of accounts receivable accounting? No.
Apollo Shoes, Inc.
Internal Control Questionnaire Sales Transaction Processing
December 31, 2007
Objectives and Questions Yes, No, N/A Comments
Environment:
1. Is the credit department independent of the sales department? Yes. Credit manager in Treasurer's office
2. Are sales of the following types controlled by the same procedures described below? Sales to employees, COD sales, disposals of property, cash sales and scrap sales. No available information, apparently not applicable
Existence Objective:
3. Is access to sales invoice blanks restricted? Yes. Kept in locked closet
4. Are prenumbered bills of lading or other shipping documents prepared or completed in the shipping department? Yes. Shipping department
Completeness Objective:
5. Are sales invoice blanks prenumbered? Yes
6. Is the sequence checked for missing invoices? No available information
7. Is the shipping document numerical sequence checked for missing bills of lading numbers? No available information
Valuation Objective:
8. Are all credit sales approved by the credit department prior to shipment? Yes. Credit manager file
9. Are sales prices and terms based on approved standards? Yes. Approved price file
10. Are returned sales credits and other credits supported by documentation as to receipt, condition, and quantity and approved by a responsible officer? No available information
Occurrence Objective:
11. Are shipped quantities compared to invoice quantities? Yes. Shipping department clerk
12. Are sales invoices checked for error in quantities, prices, extensions and footing, and freight allowances and checked with customers' orders? Yes. Accounts receivable clerk
13. Is there an overall check for errors in arithmetic accuracy of period sales data by a statistical or product-line analysis? Yes. Marketing vice president
14. Are periodic sales data reported directly to general ledger accounting independent of accounts receivable accounting? No.