问答题
4.
问答题
(a) Explain the purpose of a value for money audit. (4 marks)
【正确答案】A value for money audit focuses on whether the best combination of services has been obtained for the lowest level of resources.
In performing a value for money audit there are three areas which an auditor will commonly focus on being economy, efficiency and effectiveness, and these are known as the three Es.
Economy – Keeping the cost of resources used to a minimum.
Efficiency – The relationship between the output from goods and services and the resources used to produce them.
Effectiveness – How well the organisation’s objectives have been achieved.
【答案解析】
问答题
(b)Bluesberry hospital is located in a country where healthcare is free, as the taxpayers fund the hospitals which are owned by the government. Two years ago management reviewed all aspects of hospital operations and instigated a number of measures aimed at improving overall ‘value for money’ for the local community.Management have asked that you, an audit manager in the hospital’s internal audit department, perform a review over the measures which have been implemented.
Bluesberry has one centralised buying department and all purchase requisition forms for medical supplies must be forwarded here. Upon receipt the buying team will research the lowest price from suppliers and a purchase order is raised. This is then passed to the purchasing director, who authorises all orders. The small buying team receive in excess of 200 forms a day.
The human resources department has had difficulties with recruiting suitably trained staff. Overtime rates have been increased to incentivise permanent staff to fill staffing gaps, this has been popular, and reliance on expensive temporary staff has been reduced. Monitoring of staff hours had been difficult but the hospital has implemented time card clocking in and out procedures and these hours are used for overtime payments as well.
The hospital has invested heavily in new surgical equipment, which although very expensive, has meant that more operations could be performed and patient recovery rates are faster. However, currently there is a shortage of appropriately trained medical staff. A capital expenditure committee has been established, made up of senior managers, and they plan and authorise any significant capital expenditure items.
Required:
(i) Identify and explain FOUR STRENGTHS within Bluesberry’s operating environment; and (6 marks)
(ii) For each strength identified, describe how Bluesberry might make further improvements to provide the best value for money. (4 marks)
【正确答案】Strengths and improvements of Bluesberry’s operating environment to provide best value for money
【答案解析】
问答题
(c) Describe TWO substantive procedures the external auditor of Bluesberry should adopt to verify EACH of the following assertions in relation to an entity’s property, plant and equipment;
(i) Valuation;
(ii) Completeness; and
(iii) Rights and obligations.
Note: Assume that the hospital adopts International Financial Reporting Standards. (6 marks)
【正确答案】
【答案解析】