Exam 11: Auditing the Purchasing Process

When an auditor selects a sample of items from the vouchers payable register for the last month of the period under audit and traces these items to underlying documents, the auditor is gathering evidence primarily in support of the assertion that

The authority to accept incoming goods in receiving should be based on a(an)

Which of the following control activities is not usually performed in the accounts payable department?

Substantive procedures to examine the cutoff assertion for accounts payable include

Assertions about classes of transactions and events for the period under audit include

Which of the following procedures would an auditor most likely perform in searching for unrecorded liabilities?

Which of the following is an internal control that would prevent a paid disbursement voucher from being presented for payment a second time?

Describe three categories of expenses outlined in FASB Concept Statement No. 5.

The key inherent risk factors an auditor must consider when auditing the purchasing process are industry factors. Which two are most important and why?

Which of the following audit procedures is least likely to detect an unrecorded liability?

Unrecorded liabilities are most likely to be found during the review of which of the following documents?

An important primary purpose of the auditor's review of the entity's procurement system should be to determine the effectiveness of the activities to protect against

Because of the low volume of purchase return transactions, the auditor normally does not test the controls associated with these transactions.

The audit procedures used to verify accrued liabilities differ from those employed for the verification of accounts payable because

Purchase cutoff procedures should be designed to test whether or not all inventory

Operating control over the check signature plate normally should be the responsibility of the

Assertions about account balances at the period end include

The accounts payable department is responsible for ensuring that all vendor invoices, cash disbursements, and adjustments are recorded in the accounts payable records.

As an in-charge auditor, you are reviewing a summary of control weaknesses in cash disbursement procedures. Which one of the following weaknesses, standing alone, should cause you the least concern?

A voucher