Sky Furniture LLC Summary: Sky furniture LLC is a store whose operations are done through manufacturing and distribution divisions. The customer order process by the Sky Furniture LLC’S Distribution division is also given in detail. The distribution division uses the internal control approach where in the distribution division produces monthly management reports. This case study is done to revive the weakness in the internal approach taken by the Sky Furniture’s LLC distribution and how has it affected the reported profitability. An audit plan for Sky Furniture’s distribution division will also be prepared based on the risk assessment. Internal control improvements will also be suggested to reduce the internal control weaknesses. Introduction: …show more content…
For making the audit planning an auditor can follow these steps for making an internal audit plan more efficient: 1. He must conduct the mock audits. 2. Define the roles and responsibilities of different distribution division. 3. Should conduct risk assessment for the company. 4. Must keep stock check every month to have a close look on loss of stock. 5. Should keep a close watch on each head of distribution division to eradicate fraud. 6. Close out audit findings. Measures for efficient internal control: For an efficient internal control in the distribution division a few measures can be taken. This can increase the profitability of the company leading to growth. Measures for efficient internal control in distribution division: 1. Increase Oversight: Internal controls without oversight are not good enough. You, or a trusted resource, should diligently review bank statements, check stock and keep close on the employees in order to prevent loss of stock. 2. Provide Adequate Training to Staff: The Company must provide training to the staff so that they are trustworthy which can prevent fraud and loss of stock leading to increase in