(a) Internal control questionnaire relating to inventory:
1. Is the storage accommodation adequate to provide protection against – deterioration? – access by unauthorized persons? – any other local hazards?
2. Are issues from the stores made only against properly authorized requisition(s)?
3. Who are authorized to sign requisition? Specify name, position, etc.
4. Are bin cards or similar records maintained at the stores location?
5. Are continuous stock records maintained for – raw materials? – bought out components? – consumable stores? – finished goods? – stocks held on behalf of third parties?
6.Are these records maintained – in quantity only? – in value only? – in both quantity and value?
7. Are stores records maintained by a person independent of – the store keepers? – those responsible for physically counting or checking stocks?
8. Are independently maintained control accounts kept for each category of stock mentioned in 5?
9. Is the counting system fully integrated with the financial records?
10. If not are totals of various categories of costs (including overheads) regularly reconciled with the actual costs in the financial records?
11. Are work orders issued – against specific orders? – on the basis of pre-determined production targets? – on some other basis?
12. How are work orders authorized? Specify.
13. On what basis are materials, labour and other direct costs charged to the work-in-progress accounts? Specify.
14. Are Overheads clearly divided into fixed and variable overheads?
15. What is the basis of allocation of overheads to costs and recovery of overheads ? Specify.
16. Does the system ensure that excess or abortive costs are written off and not carried forward in the work in progress?