4 Osier Co
Generally up to 1½ marks for each well explained matter and 1 mark for each well explained piece of evidence
recommended.
Note: Marks will be awarded for explanations of why calculations and balances are complex or subjective and how
this affects their accuracy. Simple statements that calculations and balances are complex or subjective will be
awarded a maximum of ½ mark each, where relevant.
(a) Inventory
Matters:
– Materiality
– Complexity of calculation
– Subjectivity in calculation
Evidence:
– Documentation of systems and controls
– Summary of purchase costs and matching to purchase invoices
– Calculation of forecast wages matched to underlying HR and payroll records
– Confirmations of wage increments/rises
– Calculation of forecast production units reviewed in comparison to prior year
– Calculation of forecast overheads corroborated to new agreements
Maximum marks 7