When Mr. Avila orders materials for his construction business, he sends a duplicate copy of the purchase order to he receiving department. During the delivery of materials, Mr. Nobles, the receiving clerk, records the receipt of shipment of this purchase order. After recording, Mr. Nobles sends the purchase order to the accounting departm where it is used to record materials purchased and accounts payable. The materials are trasported to the storage area by forklifts. The additional purchased quantities are recorded on storage records. Required: Identify the weakness/weaknesses in internal control and opposite the identified weakness or weaknesses, enumerate the control procedure/s that you will recommend to avoid or mitigate the risk of loss.

When Mr. Avila orders materials for his construction business, he sends a duplicate copy of the purchase order to he receiving department. During the delivery of materials, Mr. Nobles, the receiving clerk, records the receipt of shipment of this purchase order. After recording, Mr. Nobles sends the purchase order to the accounting departm where it is used to record materials purchased and accounts payable. The materials are trasported to the storage area by forklifts. The additional purchased quantities are recorded on storage records. Required: Identify the weakness/weaknesses in internal control and opposite the identified weakness or weaknesses, enumerate the control procedure/s that you will recommend to avoid or mitigate the risk of loss.

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter9: Auditing The Revenue Cycle.

Section: Chapter Questions

Problem 4CYBK

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