Exam (elaborations)
AUI3701 ASSIGNMENT 3 SOLUTIONS 2023 SEMESTER 1
- Institution
- University Of South Africa (Unisa)
AUI3701 ASSIGNMENT 3 SOLUTIONS 2023 SEMESTER 1
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MENU Dashboard / Courses / UNISA / 2023 / Semester 1 / AUI3701-23-S1 / Welcome Message / Assessment 3
Started on Sunday, 23 April 2023, 5:29 PM
State Finished
Completed on Sunday, 23 April 2023, 7:11 PM
Time taken 1 hour 42 mins
Marks 22.00/25.00
Grade 88.00 out of 100.00
Question 1
Correct
Mark 1.00 out of 1.00
Nandi is an internal auditor of an electric car manufacturer called Auto Electric (Pty) Ltd or Autotric for short. Autotric has a research and
development department responsible for innovative ideas to make the electric cars manufactured by Autotric attractive to the market. One
of the major components that go into the electric car is the lithium battery. Lithium is the mineral ore that is mined and then further
processed to make lithium batteries. Autotric’s research and development department is responsible for sourcing the best lithium ore that is
used in their electric cars’ batteries.
While obtaining an understanding of the electric car market. Nandi comes across a human rights research paper stating that most of the
world’s lithium ore is mined in war-torn countries which use child labour and do not respect the environment.
Nandi wants to include in her engagement scope tests on how Autotric sources its lithium ore. Autotric management believes that the
source of its lithium batteries is a trade secret and it’s a “no-go area” for the internal audit or any employees outside the research and
development department.
Based on the above scenario, what should Nandi do?
I. Inform the Chief Audit Executive (CAE) of the scope limitation.
II. Document in the audit engagement letter the scope limitation and the nature of the scope limitation.
III. Document in the final audit report that there was a scope limitation and the nature of the scope limitation.
IV. Make a compromise with management that the internal audit has access to the research and development records, but the internal audit
final report will exclude the “no-go areas”.
Select the correct option.
a. I, II, III
b. IV
c. II, III
d. I
Your answer is correct.
The correct answer is:
I, II, III
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