If a real physical system shows a variation of both material properties across the graded layer, the assumed linear variation may not give the best approximation.

Trombone Co (Trombone) operates a chain of hotels across the country. Trombone employs in excess of 250 permanent employees and its year end is 31 August 2014. You are the audit supervisor of Viola & Co and are currently reviewing the documentation of Trombone’s payroll system, detailed below, in preparation for the interim audit.

Trombone’s payroll system

Permanent employees work a standard number of hours per week as specified in their employment contract. However, when the hotels are busy, staff can be requested by management to work additional shifts as overtime. This can either be paid on a monthly basis or taken as days off.

Employees record any overtime worked and days taken off on weekly overtime sheets which are sent to the payroll department. The standard hours per employee are automatically set up in the system and the overtime sheets are entered by clerks into the payroll package, which automatically calculates the gross and net pay along with relevant deductions. These calculations are not checked at all. Wages are increased by the rate of inflation each year and the clerks are responsible for updating the standing data in the payroll system.

Employees are paid on a monthly basis by bank transfer for their contracted weekly hours and for any overtime worked in the previous month. If employees choose to be paid for overtime, authorisation is required by department heads of any overtime in excess of 30% of standard hours. If employees choose instead to take days off, the payroll clerks should check back to the ‘overtime worked’ report; however, this report is not always checked.

The ‘overtime worked’ report, which details any overtime recorded by employees, is run by the payroll department weekly and emailed to department heads for authorisation. The payroll department asks department heads to only report if there are any errors recorded. Department heads are required to arrange for overtime sheets to be authorised by an alternative responsible official if they are away on annual leave; however, there are instances where this arrangement has not occurred.

The payroll package produces a list of payments per employee; this links into the bank system to produce a list of automatic payments. The finance director reviews the total list of bank transfers and compares this to the total amount to be paid per the payroll records; if any issues arise then the automatic bank transfer can be manually changed by the finance director.

Required:

(a) In respect of the payroll system of Trombone Co:

(i) Identify and explain FIVE deficiencies;

(ii) Recommend a control to address each of these deficiencies; and

(iii) Describe a test of control Viola & Co should perform. to assess if each of these controls is operating effectively.

Note: The total marks will be split equally between each part. (15 marks)

(b) Explain the difference between an interim and a final audit. (5 marks)

(c) Describe substantive procedures you should perform. at the final audit to confirm the completeness and accuracy of Trombone Co’s payroll expense. (6 marks)

Trombone deducts employment taxes from its employees’ wages on a monthly basis and pays these to the local taxation authorities in the following month. At the year end the financial statements will contain an accrual for income tax payable on employment income. You will be in charge of auditing this accrual. Required:

(d) Describe the audit procedures required in respect of the year end accrual for tax payable on employment income. (4 marks)

Bus Co is a large bus operator, operating long-distance bus services across the country. There are two other national operators in the country. Bus Co’s mission is to ‘be the market leader in long-distance transport providing a greener, cleaner service for passengers nationwide’. Last month, an independent survey of 40,000 passengers was carried out, the results of which are shown in the table below:

Table: Bus passenger satisfaction % by national operator

* denotes that the percentage has not yet been calculated.

The ‘overall satisfaction’ percentages, which have not yet been inserted into the table, are calculated using a weighted average which reflects the importance customers place on each of the other three criteria above. The weightings used are as follows:

The managing director (MD) of Bus Co has said: ‘Independent research has shown that our customers are the most satisfied of any national bus operator. We are now leading the way on what matters most to customers – value for money and punctuality.’

Required:

(a) Calculate the ‘overall satisfaction’ percentage for each operator. (2 marks)

(b) Taking into account all the data in the table and your calculations from part (a), discuss whether the managing director’s statement is true. (4 marks)

(c) When measuring performance using a ‘value for money’ approach, the criteria of economy, efficiency and effectiveness can be used.

Required:

Briefly define ‘efficiency’ and ‘effectiveness’ and suggest one performance measure for EACH, which would help Bus Co assess the efficiency and effectiveness of the service it provides. (4 marks)

Elegant Hotels is a chain of twenty hotels across the country. Each hotel is wholly owned by the company. Four years ago the chain was bought by a group of investors who installed a new management team.

The new management team introduced a new reward scheme for the hotel managers in an attempt to motivate managers to improve the revenue and profitability of the chain. The salary package devised for each manager comprised:

– A relatively low fixed salary

– A bonus payment based on high room occupancy rate. The occupancy rate is the percentage of usable hotel beds filled every night. Managers who achieved more than 90% occupancy rate receive a significant bonus. This target is aimed at keeping the hotel full.

– A smaller bonus payment based on the net profit margin achieved by the hotel. This is aimed at improving the profitability of the hotel.

However, despite these incentives the overall performance of the company is still declining. Managers are generally achieving a high occupancy rate but are largely failing to deliver higher net margins. It is also clear that some managers have achieved a high occupancy rate by declaring that some bedrooms were unfit for use or were being used as seminar rooms.

Also, the pursuit of high occupancy and high net profit appears to be affecting the perceived image of the hotel chain.

Once regarded as a mid-market hotel chain, the chain now seems to be perceived as a budget buy. A large percentage of bookings are received through the Internet broker lastsecondhotels.com and their view of the chain is given below, together with some visitor quotes from their web site.

Comments

‘Great last minute bargain … very easy to get rooms at half the advertised rate’

‘Full of school children on a trip … will not be using this chain again’

‘No Internet connections in the rooms or public areas, very disappointing’

‘The bath was cracked and the windows were dirty. Cheap, but badly in need of a clean’

‘Receptionists were very off-hand and unable to help. Did not seem to know much about the area surrounding the hotel’

‘The staff were surly and uncommunicative. Much worse than last time we visited it. It used to be such a lovely hotel’

‘Cheap, but don’t eat there. The price for breakfast was extortionate’

‘Cheap and cheerful but don’t pay the full rate! Always lots of cheap beds available’

‘Food was expensive and dull. The serving staff were uncommunicative, the cutlery was dirty and damaged. Staff were more interested in talking to each other than to the customers’

‘Restaurant food was very expensive and of poor quality. The two nights I stayed there I was the only customer in the restaurant’

Lastsecondhotels.com says: ‘Value for money hotels with rooms always available. Perfect for those last minute breaks’

Required:

(a) Analyse the unanticipated consequences of the management reward scheme at Elegant Hotels. (15 marks)

(b) The DMAIC methodology of Six Sigma includes five steps: Define, Measure, Analyse, Improve and Control.

Evaluate the potential benefits of using the DMAIC methodology at Elegant Hotels. (10 marks)

School shootings across the country continue to discuss the story of the student who is outcast by fellow peers and decides to lash out. These reports may leave some wondering if ostracism is a legitimate cause for violence. Kip Williams believes it is. Williams, a professor of psychology at Purdue University, recently came to campus to speak about the effects of being ostracized. These effects can be distressing, but they often go unnoticed, he said. "I would have rather been beaten or bullied than be ignored," Williams said, reflecting on what some of the participants in his experiments felt after they were left out of a game of toss. "Even two minutes of invisibility is painful," he said.

Ostracism, the act of ignoring or excluding, is a phenomenon not only found in the adult world, according to Williams. Children play simple games which leave peers out without being taught to do so. Even animals use forms of ostracism, Williams said. Lions, wolves and bees, for example, use the tactic to keep out burdensome members of their groups, which often results in death for the excluded member. Exclusion among humans can be similarly detrimental, he said.

Williams conducted a computer game of toss, and showed the results for those who did not receive

the ball. Their angry, disappointed and saddened faces showed just how important inclusion is in human interaction. In another experiment, the excluded participants had no control over loud noises entering their headphones. The result was that they chose to act out against fellow participants.

That lack of control is what Williams believes triggers aggression. "When control is robbed, then people don't care about how they are being liked anymore," Williams said. "They just want to establish control by being recognized. People are more likely to be violent in order to get that recognition," Williams said.

His research has found that people are generally ostracized at least once a day, like the waiter who refills water glasses without notice, or the person who sits next to you on the bus without a glance. These interactions may not seem like much, but Williams asserts that even the slightest situations in which people feel invisible can have a negative impact on them. In his studies, a total of 70 percent of people said they had been given the "silent treatment" by their loved ones.

The central concept of the passage "ostracism" most probably refers to ______.

A．the problem of distressing experienced by school students

B．the phenomenon of some students being excluded by peers

C．the violence happening on campus witnessed by students

D．the issue of some students unwilling to communicate with peers

Passage One

At Benjamin N. Cardozo High School in Queens, he was known as Matthew Kaye, an earnest social studies teacher shepherding his ninth-and tenth-grade students across the panorama of global history. But out of school-on the professional wrestling circuit- he was Matt Striker, a muscleman known for a move called the lung blower.

His double life may have body-slammed ins teaching career.

According to city investigators, Mr. Kaye, 31, falsely called in sick for 11 days in December and February when he was actually on the wrestling tour. Faced with disciplinary action, Mr. Kaye resigned in April, but yesterday be said that he hoped to get ins job back

"There are people out there who touch children inappropriately who are still allowed to work, "Mr. Kaye said in a telephone interview. "The only thing I did was I put in sick days instead of personal days, because I didn't know them was a difference."

But Richard J. Condon, the special commissioner of investigation for the city schools, said it was not that simple. Teachers get 10 sick days a year and only 3 of those can he used for personal business.

Investigators from Mr. Condon's office said a woman who identified herself as Mr. Kaye's mother called Cardozo in December and said that he was out because of a family emergency. Mr. Kaye later told an assistant principal at the school flat his sister was ill.

Then Mr. Kaye was absent in February, when wrestling Web sites said that he appeared on die television show "Smack Down!" in a match against Kurt Angle.

Investigators sought to interview Mr. Kaye, but his lawyer canceled the session and Mr. Kaye resigned.

Mr. Kaye eventually provided two notes from doctors for his absences. But investigators questioned their validity and urged the State Health Department's Office of Professional Medical Conduct to investigate and take action.

Passage Two

The evidence of dietary protection against cancer is strongest and most consistent for diets high in vegetables and fruits, according to an earlier report by the World Cancer Research Fund (WCRF).

The WCRF panel of experts concluded that the daily consumption of 400 grains or more of a variety of vegetables and fruits could, irrespective of other diet and lifestyle. patterns, decrease overall cancer incidence by at least 20 per cent, according to the Asia Food Information Centre.

There is convincing evidence that diets high in vegetables and fruits protect against cancers of the mouth and pharynx, oesophagus, lung, stomach, rectum, larynx, pancreas, breast and bladder. High dietary fiber is also associated with lower risk of some cancers, especially bowel cancer.

The recommended daily intake of dietary fiber is 25-30 grams for a healthy adult. This can only be achieved by incorporating high fiber foods such as whole grains, vegetables, fruit, nuts and seeds into eating patterns every day and/or using a bran supplement.

Adequate fruit and vegetable intake has a protective effect, helping ward off chronic diseases while helping to elevate resistance to infections disease and reduce nutritional deficiencies. Fruit and vegetables actively promote health by providing bodies with essential vitamins, nutrients, fiber and a myriad of phytochemicals (植物化学物质) which acts as antioxidants (抗氧化剂 in the body. Antioxidants neutralize the free radicals that accelerate the process of cell decay and increase the chances of cells becoming cancerous.

Four hundred grams of fruits and vegetables per person per day (excluding potatoes and other starchy tubers) for the prevention of chronic diseases translates to approximately "5-a-day" that is, eating five or more servings of fruit and vegetables every day.

One serving is roughly the amount that fits into the pa

A．Y

B．N

C．NG