Audit Note Book and Internal Audit: Importance and Functions
Audit Note Book
An audit note book is a document prepared by audit staff to record uncleared queries, errors, and points for discussion with auditors or clients. It contains information about daily audit work and points to be included in the audit report.
Contents of Audit Note Book
- Copy of audit program
- Nature of business and important documents
- Client name and audit year
- List of books of accounts
- Principal officers’ names, duties, and responsibilities
- Accounting and financial policies
Special Matters to
Read MoreStatistical Hypothesis Testing and Confidence Intervals
1. Consider the three statements below. Draw a circle around any (if any) and all that are valid statistical hypotheses.
HA: p
_____ 3. Definition: the probability, assuming the null hypothesis is true, that a test statistic takes a value as extreme or more extreme than the value actually observed is which of the following?
(D) P-value
4. In the article “Shooting Left the Right Way” it is reported that 63% of all skaters
Read MoreStatistics Formulas and Practice Exercises
Key Elements
1. Probability Formulas:
- Probability of an event: P(A)
- Complementary probability: P(A’) or P(Ac)
- Addition rule: P(A or B)
- Multiplication rule: P(A and B)
- Conditional probability: P(A | B)
- Bayes’ theorem
2. Descriptive Statistics Formulas:
- Mean (average)
- Median
- Mode
- Range
- Variance
- Standard deviation
- Interquartile range
3. Probability Distributions:
- Normal distribution: mean, standard deviation, z-score
- Binomial distribution: mean, standard deviation, probability of success
- Poisson distribution: mean, standard
Statistical Inferences on Proportions: Assumptions, Sampling Distributions, Confidence Intervals, and Hypothesis Testing
- (8 points) In the current chapter covering statistical inferences on proportions, all of the procedures we have discussed (sampling distributions, confidence intervals and statistical tests) have involved two assumptions. What are those two assumptions?
- 1. Simple random sample
- 2. Large enough sample for the Central Limit Theorem to apply.
- 2. (4 points) Consider the three statements below. Draw a circle around any (if any) and all that are valid statistical hypotheses.
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Inventory Management: Types, Pressures, and Control Systems
Inventory Management
Types of Inventory
- Raw Materials (RM)
- Work-in-Process (WIP)
- Finished Goods (FG)
Pressures for Inventory
Pressures for Small Inventories
- Temporary monetary investment
- Inventory holding cost (or carrying cost)
- Cost of capital
- Storage and handling costs
- Taxes, insurance, and shrinkage
Pressures for Large Inventories
- Customer service
- Ordering cost
- Setup cost
- Labor and equipment utilization
- Transportation cost
- Payments to suppliers
Inventory Control Systems
Two Important Questions
- How much?
- When?
Nature
Read MoreStatistical Hypothesis Testing
1. Which of the following is a valid statistical hypothesis?
(A) HA: p
2. In October 2010 Jimmy McMillan made national headlines while campaigning for Governor of New York on his party slogan “The Rent is Too Damn High.” Mr. McMillan only received 1% of the votes for Governor, but his campaign did create an interest in how much people pay for rent. Of particular interest is the proportion of all renters in the state of New York that pay $1400 or
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