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QUESTION $4$

$35$ marks

Part A

Once the audit on the online ordering department of Sun$-$look Ltd was completed, an audit was scheduled for the distribution process. It was noted that few credit notes were processed for sunglasses returned by customers. The internal audit manager requested the junior interna auditor to obtain audit evidence that relates to the audit objective that relates to the processing of the credit notes. The junior internal auditor presented the following audit evidence that was obtained regarding the processing of credit notes:

Credit notes of the sunglasses that were returned were inspected for approval.

The manager of the distributions department was interviewed and asked to explain the various processes followed when processing a credit note.

The senior internal auditor directly observed the processing of a credit note.

The total value of credit notes processed during the year, was calculatd and compared to last year's value.

$6$

AUI$2601/1/2024$

Obtained a list of all returns and inspected that valid reasons were noted by the customer for returning the sunglasses.

REQUIRED

Marks

$4\mathrm{.}1$ Classify each of the audit evidence listed above $(1-5)$ into the different kinds of audit evidence.

$4\mathrm{.}2$ List and describe the characteristics with which audit evidence must comply as per the IIA Standards.

Part B

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