Quizizz#10 Auditing Purchases

The source document for an employee's request for a new computer

• Purchase Order

• Requisition Report

• Receiving Report

• Vendor Invoice

Responsible for inspecting purchases but not for making the purchases

• Receiving Department

• Purchasing Department

• Accounts Payable Department

• Invoice Department

In a well designed accounting information system, accounts payable is responsible for paying vendor invoices

• True

• False

The primary control for purchase completeness is

• Requisition and purchasing should be seperate

• Payment should not be made without a purchase order & receiving report

• Sequentially numbered source documents

• Bank reconciliations

The primary control for cash disbursement existence is

• Bank reconciliations

• Sequentially numbered checks

• Sequentially numbered journal entries

• Monthly cut-off tests

The inherent riskiness of overstating accounts payable

• High

• Medium

• Low

The primary control for cash disbursement completeness

• Requisitioning & disbursement should be seperate

• pre-numbered checks

• Receiving & disbursement should be seperate

• Receiving reports

The auditor expects purchase returns to be material

• True

• False

The auditor would use a cut-off test if (s)he is concerned about

• Existence

• Completeness

• Valuation

• Presentation & Disclosure

The main risk when auditing liabilities

• Liabilities are overstated

• Liabilities are understated

• Fictitious liabilities

• Fraudulent liabilities