Internal controls and accounting systems
AAT Level 4 Diploma in Accounting
This sample assessment is for familiarisation purposes only and must not be used in place of a ‘live’ assessment.
When you feel prepared to sit the live assessment please contact your Training Provider who can schedule a live assessment for you.
The unit being assessed by this report is Internal Controls and Accounting Systems. Assessment is by a formal business report, which can be reviewed by your assessor up to a maximum of five times.
You should map your report to these units by page and paragraph number to ensure that you cover all the assessment criteria (see Appendix 1 – Mapping of report to outcomes and criteria).
You may have four further opportunities to submit additional supporting evidence at the discretion of your assessor, but the report MUST be fully completed and assessed within six months. Please discuss this with your assessor
There may also be a final interview required with your assessor. Assessors will conduct a final interview with Distance Learning candidates.
If you are assessed as not yet competent on completion of the six month period, it will be necessary for you to complete a new report based upon a different case study.
To access general guidance on report writing and report content, log into your MyAAT account on the AAT website, http://aat.org.uk/myaat.
You have recently been employed as Senior Accounts Clerk for Cookridge & Cookridge Carpets. This is a full time position, and the organisation is willing to support you finishing your AAT Level 4 studies by attending the local college on an evening.
The first job the directors have asked you to do is to review the accounting system, the effectiveness of its internal controls, and whether the culture of the organisation could be improved in terms of working ethically and their environmental sustainability.
You are then asked to make any recommendations for improvements that you feel are necessary.
The directors know there are many weaknesses, but are uncertain as to how these should be managed.
To help you in this they have asked the accounts clerks to prepare some brief information about themselves, an overview of the accounting system, and also a list of events that have occurred over the previous few months. This information can be found in the company diary.
The directors have also suggested you review the following documents:
You are required to produce a business report for Peter and John Cookridge. This should be approximately 4,000 to 5,000 words long.
The report should be mapped to the learning outcomes and assessment criteria on page 4 by paragraph number to ensure all criteria are covered.
The detailed task requirements are set out on pages 5 and 6.
Learning outcomes and assessment criteria
1. Understand the role of accounting within an organisation
1.1 Describe the purpose, structure and organisation of the accounting function and its relationship with other functions within the organisation.
1.2 Explain the various business purposes for which the following financial information is required – statement of profit or loss, statement of cash flow, and statement of financial position.
1.3 Give an overview of the organisation’s business and its critical external relationships with stakeholders.
1.4 Explain how the accounting systems are affected by the organisational structure, systems, procedures and business transactions.
1.5 Explain the effect on users of changes to accounting systems caused by external regulations, and organisational policies and procedures.
2. Understand the importance and use of internal controls
2.1 Identify the external regulations that affect accounting practices.
2.2 Describe the causes of and