Академический Документы
Профессиональный Документы
Культура Документы
! Access to:
! inventories (direct)
! cash (direct)
! accounting records (indirect)
Manual
Independent Verification
! A/Payable dept. verifies much of the work done
within the expenditure cycle.
! PR, PO, receiving reports, and suppliers’ invoices must be
checked and verified by A/P.
! G/Ledger dept. verifies:
! the total obligations recorded equal the total inventories
received
! the total reductions in accounts payable equal the total
disbursements of cash
ASSESSING CONTROL RISK
Obtain Understanding
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TEST OF CONTROLS
Purchasing, Disbursements
! Provide a reasonable degree assurance that
employees comply with management’s
procedures
! Purchasing
! Properly authorized, executed, recorded
! Disbursements
! Payments remitted, recorded promptly
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CONTROL RISK
Purchasing
! Major risks
! Unauthorized purchases
! Non-competitive prices
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TESTING CONTROLS
Purchasing
! Select random sample paid voucher packages
! Examine for cancellation, authorization, details
! Obtain Purchasing Department’s copy of requisition,
purchase order
! Compare to voucher package
! Trace to competitive bids
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CONTROL RISK
Receiving
! Major risks
! Goods received not counted, inspected
! Goods received not compared to purchase orders
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TESTING CONTROLS
Receiving
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CONTROL RISK
Cash Disbursements, Recording
! Major risks
! Cash payments made to unauthorized payee
! Details recorded in voucher register are recorded for
proper vendor
! Totals agree to general ledger
32
TESTING CONTROLS
Cash Disbursements, Recording
! Obtain canceled checks for voucher package
! Examine for signatures, endorsements
! Compare detailed information about check from
voucher package to canceled check
! Trace voucher packages, canceled checks to postings
! Review for classification, accuracy
! Scan voucher register for unusual items
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ASSESSING CONTROL RISK
! 2 Questions
! Are controls effective?
! Can controls be relied upon?
! If answer is yes to both
! Assess control risk below maximum
! Assess detection risk above minimum
! Restrict substantive tests of sales, receivables, cash
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TESTS OF CONTROLS
Promotion Accrual
! Review reconciliation promotion payments
! Test calculation
! Review accrual
! Search for post period-end payments for evidence
of unrecorded promotions
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POTENTIAL ERRORS, FRAUDS
! Cash disbursed to unauthorized parties
! Duplicate payments made
! Account balances inaccurate
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