BackgroundPwC ofers a tool—CAVR—that may be used to help evaluate control design.CAVRaddresses inFormation processing objectives.CAVR is concise and helpFul.CAVR stands For:Completeness
BackgroundPwC ofers a tool—CAVR—that may be used to help evaluate control design.CAVRaddresses inFormation processing objectives.CAVR is concise and helpFul.CAVR stands For:Completeness—All transactions that occurred are entered once, and only once, andare accepted For processing.Accuracy—Transactions are recorded at the correct amount, in the appropriateperiod, and in the appropriate account.Validity—All recorded transactions are REAL and actually occurred, relate to theorganization, and are approved by designated personnel.Restricted Access—Data is protected against unauthorized amendments, itscon±dentiality is ensured and physical assets are protected.²irst watch the CAVR video (8 mins).Make sure you take good notes while watching thevideo, as you will need all that information to complete your task.InFormation Gathering²or this assignment, your objective will be to critically analyze Alchemy, Inc. management’sassessment oF its internal controls over receiving, operations and shipping.We will use theCAVR model to help us with this.Begin with reading the Following attached documents:1.Management Drawing2.Management’s Control MatrixRequirementPart A:Evaluate the accuracy oF Management’s Control Matrix and complete its ±nalcolumn:a.Do you agree with management’s description oF each oF the controls andcontrol de±ciencies it has identi±ed?IF you agree, say “OK” in the last columnoF the matrix and add any relevant comments about the control iF it will behelpFul on the audit.IF you disagree, either say that either it is not a control orthat while it is a control, it is not either designed or operating efectively;explain.b.Has management missed any controls?IF yes, add these to the bottom oF theschedule.c.Has management missed any control de±ciencies?IF yes, add these to thebottom oF the schedule.Part B:In the space provided below the “Management Control Matrix”, identiFyareas where Fraud is likely to occur.Clearly explain the nature oF the Fraud anticipated
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