The following information relates to the acquisition and disposal of tangible non-current assets of B Ltd.

| March 17, 2019

Referencing Styles : APA

The following information relates to the acquisition and disposal of tangible non-current assets  of B Ltd.:
a.    A purchase requisition form is completed and approved by the departmental manager for acquisition of new assets.
b.    The purchase requisition form is checked by the purchasing officer for approval.   Then, the purchasing officer completes the purchase order.
c.    The financial accountant approves acquisition of new assets over $5000.    The board of directors approves purchase of new assets over $10000.
d.    A copy of the purchase order is sent to the supplier and to the head office.
e.    The receiving clerk checks that the details of the asset purchased agrees with those on the receiving report and the purchase order.   The receiving clerk issues barcode numbers to the asset acquired.   The barcode is attached to the asset and recorded on the receiving report and the supplier invoice.
f.    The departmental manager keys in the details of the assets acquired into the asset register using a copy of the purchase order, the requisition form and the barcode.
g.    An asset disposal form is completed by the departmental manager and a copy is sent to the financial accountant for approval.    A copy of the approved asset disposal form is filed at head office and sent to the departmental manager for updating the asset register.
h.    The asset register is reconciled to the general ledger by the departmental manager monthly.
i.    Depreciation is calculated monthly by the rate input by the departmental manager.

Required
1)    Identify the strengths of internal control of the acquisition and disposal of tangible non-current assets of B Ltd.
2)    Suggest procedures for testing the internal control of the system.
                             

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