Case

Azzahra is a book publisher, publishes and distributes educational and non-educational books and sell them to libraries and bookstores within Saudi Arabia and in the Arabian Gulf Region (AGR).

Azzahra employs a professional editorial team. All printing and binding activities are outsourced. The annual revenue total 250 millions Saudi Riyals which are disbursed as follows:

In millions	Cash	Credit	Total	Total Customers
Within Saudi	40	120	160	4680
From other AGR	10	80	90	2120
Total	50	200	250	7800

Cash expenditures are 150 million Saudi Riyals. Non-cash expenditures are 50 million Saudi Riyals. While revenues may be paid in different currencies, all processed out in the main center in Riyadh and using Saudi Riyal.

Requirement

Suppose you are a member of the professional editorial team and your task is to audit the revenue and accounts receivable. You probably would like to perform your audit in the following order:

1- Establish audit objectives

2- Determine the scope of the audit

3- Apply the Seven Habits of Highly Effective People (expected outcomes).

4- Understand the auditee (gather relevant information, analytical procedures, control

analysis, process flow, process risks)

5- Identify and assess risks

6- Identify key controls

7- Evaluate controls

8- Create test plan

9- Develop work program

10- Gather evidences

11- Evaluate evidences and reach conclusion

12- Develop observation and formulate recommendation.