Finance related

Neha has drafted the ledger accounts and financial

statements at year end for her promotions and marketing

business and is pleased that Gross Profit is £74,500 and Net

Profit is £14,500. However, on checking the details more

closely, she identifies the following:

Rent from a client of £3,500 for the short-term use of an

unwanted outbuilding for storage has been credited to the

Land and Buildings account.

The cost of a colour photocopier for the business, £13,500

including installation costs, has been debited to the Purchases

account.

A bill for £650 for repairing some office equipment has been

debited to the Vehicle Expenses account.

The price of a motor vehicle for business use, namely £7,500,

has been debited to the Vehicle Expenses account. Carriage in

of £80 has been entered to the Postage and Delivery account.

£18,000 from the sale of the outbuilding has been credited to

the Sales Revenue account

a) Describe the role and purpose of an internal auditor for a

business

b) Why an External Auditor is needed