Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 14A, Problem 1P

a.

To determine

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

a.

Expert Solution

Explanation of Solution

Internal control:

Internal control is a process of controlling the activities within the organization. Business deals with various set of activities. To perform every activity effectively, the management of the company should control and manage the activities. The control of these activities is known as an internal control.

Error or fraud in the financial statement:

When there is a misstatement of the financial statements of the company because of the intentional and unintentional error then it is known as error or fraud in the financial statement.

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls:

Control	Error or Fraud Controlled
1	This activity would provide control over the unauthorized and invalid payment of the accounts payable.
2	This activity would control over the completeness of the transactions.
3	This activity would prevent the chances of duplicate transactions.

b.

To determine

Provide the test of control for the provided internal control of the client.

b.

Expert Solution

Explanation of Solution

Test of control:

Test of control is performed by the auditor to verify that the control process is effective and efficient enough or not. It consists of the following two activities:

Test of control recognizes the control process required to prevent the material misstatement.
Test of control asses that the control process is operating effectively or not.

Provide the test of control for the provided internal control of the client:

Control	Tests of Controls
1	The auditor can test the control over the reconciliation by reviewing the reconciliation statement prepared by the computer. The auditor can review the vendor’s document and assess whether all the transactions are recorded in the reconciliation statement.
2	The auditor can test the control by randomly checking the entries in the receiving report. The auditor can randomly pick a few consecutive transactions and consider that their numbers are in sequence.
3	The auditor should review the mailing register and review the signature for the individual who mailed the checks.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

What is Delta Corporation's taxable income

How many units must ot sell?

Subject general accounting

Answer 2

Question

Chapter 14A, Problem 1P

a.

To determine

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

a.

Expert Solution

Explanation of Solution

Internal control:

Internal control is a process of controlling the activities within the organization. Business deals with various set of activities. To perform every activity effectively, the management of the company should control and manage the activities. The control of these activities is known as an internal control.

Error or fraud in the financial statement:

When there is a misstatement of the financial statements of the company because of the intentional and unintentional error then it is known as error or fraud in the financial statement.

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls:

Control	Error or Fraud Controlled
1	This activity would provide control over the unauthorized and invalid payment of the accounts payable.
2	This activity would control over the completeness of the transactions.
3	This activity would prevent the chances of duplicate transactions.

b.

To determine

Provide the test of control for the provided internal control of the client.

b.

Expert Solution

Explanation of Solution

Test of control:

Test of control is performed by the auditor to verify that the control process is effective and efficient enough or not. It consists of the following two activities:

Test of control recognizes the control process required to prevent the material misstatement.
Test of control asses that the control process is operating effectively or not.

Provide the test of control for the provided internal control of the client:

Control	Tests of Controls
1	The auditor can test the control over the reconciliation by reviewing the reconciliation statement prepared by the computer. The auditor can review the vendor’s document and assess whether all the transactions are recorded in the reconciliation statement.
2	The auditor can test the control by randomly checking the entries in the receiving report. The auditor can randomly pick a few consecutive transactions and consider that their numbers are in sequence.
3	The auditor should review the mailing register and review the signature for the individual who mailed the checks.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 14A, Problem 1P

a.

To determine

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

a.

Expert Solution

Explanation of Solution

Internal control:

Internal control is a process of controlling the activities within the organization. Business deals with various set of activities. To perform every activity effectively, the management of the company should control and manage the activities. The control of these activities is known as an internal control.

Error or fraud in the financial statement:

When there is a misstatement of the financial statements of the company because of the intentional and unintentional error then it is known as error or fraud in the financial statement.

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls:

Control	Error or Fraud Controlled
1	This activity would provide control over the unauthorized and invalid payment of the accounts payable.
2	This activity would control over the completeness of the transactions.
3	This activity would prevent the chances of duplicate transactions.

b.

To determine

Provide the test of control for the provided internal control of the client.

b.

Expert Solution

Explanation of Solution

Test of control:

Test of control is performed by the auditor to verify that the control process is effective and efficient enough or not. It consists of the following two activities:

Test of control recognizes the control process required to prevent the material misstatement.
Test of control asses that the control process is operating effectively or not.

Provide the test of control for the provided internal control of the client:

Control	Tests of Controls
1	The auditor can test the control over the reconciliation by reviewing the reconciliation statement prepared by the computer. The auditor can review the vendor’s document and assess whether all the transactions are recorded in the reconciliation statement.
2	The auditor can test the control by randomly checking the entries in the receiving report. The auditor can randomly pick a few consecutive transactions and consider that their numbers are in sequence.
3	The auditor should review the mailing register and review the signature for the individual who mailed the checks.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 14A, Problem 1P

a.

To determine

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

a.

Expert Solution

Explanation of Solution

Internal control:

Internal control is a process of controlling the activities within the organization. Business deals with various set of activities. To perform every activity effectively, the management of the company should control and manage the activities. The control of these activities is known as an internal control.

Error or fraud in the financial statement:

When there is a misstatement of the financial statements of the company because of the intentional and unintentional error then it is known as error or fraud in the financial statement.

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls:

Control	Error or Fraud Controlled
1	This activity would provide control over the unauthorized and invalid payment of the accounts payable.
2	This activity would control over the completeness of the transactions.
3	This activity would prevent the chances of duplicate transactions.

b.

To determine

Provide the test of control for the provided internal control of the client.

b.

Expert Solution

Explanation of Solution

Test of control:

Test of control is performed by the auditor to verify that the control process is effective and efficient enough or not. It consists of the following two activities:

Test of control recognizes the control process required to prevent the material misstatement.
Test of control asses that the control process is operating effectively or not.

Provide the test of control for the provided internal control of the client:

Control	Tests of Controls
1	The auditor can test the control over the reconciliation by reviewing the reconciliation statement prepared by the computer. The auditor can review the vendor’s document and assess whether all the transactions are recorded in the reconciliation statement.
2	The auditor can test the control by randomly checking the entries in the receiving report. The auditor can randomly pick a few consecutive transactions and consider that their numbers are in sequence.
3	The auditor should review the mailing register and review the signature for the individual who mailed the checks.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 14A, Problem 1P

a.

To determine

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

a.

Expert Solution

Explanation of Solution

Internal control:

Internal control is a process of controlling the activities within the organization. Business deals with various set of activities. To perform every activity effectively, the management of the company should control and manage the activities. The control of these activities is known as an internal control.

Error or fraud in the financial statement:

When there is a misstatement of the financial statements of the company because of the intentional and unintentional error then it is known as error or fraud in the financial statement.

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls:

Control	Error or Fraud Controlled
1	This activity would provide control over the unauthorized and invalid payment of the accounts payable.
2	This activity would control over the completeness of the transactions.
3	This activity would prevent the chances of duplicate transactions.

b.

To determine

Provide the test of control for the provided internal control of the client.

b.

Expert Solution

Explanation of Solution

Test of control:

Test of control is performed by the auditor to verify that the control process is effective and efficient enough or not. It consists of the following two activities:

Test of control recognizes the control process required to prevent the material misstatement.
Test of control asses that the control process is operating effectively or not.

Provide the test of control for the provided internal control of the client:

Control	Tests of Controls
1	The auditor can test the control over the reconciliation by reviewing the reconciliation statement prepared by the computer. The auditor can review the vendor’s document and assess whether all the transactions are recorded in the reconciliation statement.
2	The auditor can test the control by randomly checking the entries in the receiving report. The auditor can randomly pick a few consecutive transactions and consider that their numbers are in sequence.
3	The auditor should review the mailing register and review the signature for the individual who mailed the checks.

Answer 6

Chapter 14A, Problem 1P

a.

To determine

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

a.

Expert Solution

Explanation of Solution

Internal control:

Internal control is a process of controlling the activities within the organization. Business deals with various set of activities. To perform every activity effectively, the management of the company should control and manage the activities. The control of these activities is known as an internal control.

Error or fraud in the financial statement:

When there is a misstatement of the financial statements of the company because of the intentional and unintentional error then it is known as error or fraud in the financial statement.

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls:

Control	Error or Fraud Controlled
1	This activity would provide control over the unauthorized and invalid payment of the accounts payable.
2	This activity would control over the completeness of the transactions.
3	This activity would prevent the chances of duplicate transactions.

Answer 7

Chapter 14A, Problem 1P

a.

To determine

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls.

Answer 8

a.

Expert Solution

Explanation of Solution

Internal control:

Internal control is a process of controlling the activities within the organization. Business deals with various set of activities. To perform every activity effectively, the management of the company should control and manage the activities. The control of these activities is known as an internal control.

Error or fraud in the financial statement:

When there is a misstatement of the financial statements of the company because of the intentional and unintentional error then it is known as error or fraud in the financial statement.

Indicate the type of error or fraud that the control serves to prevent or detect in the given controls:

Control	Error or Fraud Controlled
1	This activity would provide control over the unauthorized and invalid payment of the accounts payable.
2	This activity would control over the completeness of the transactions.
3	This activity would prevent the chances of duplicate transactions.

Answer 9

a.

Expert Solution

Answer 10

a.

Expert Solution

Answer 11

Expert Solution

Answer 12

b.

To determine

Provide the test of control for the provided internal control of the client.

b.

Expert Solution

Explanation of Solution

Test of control:

Test of control is performed by the auditor to verify that the control process is effective and efficient enough or not. It consists of the following two activities:

Test of control recognizes the control process required to prevent the material misstatement.
Test of control asses that the control process is operating effectively or not.

Provide the test of control for the provided internal control of the client:

Control	Tests of Controls
1	The auditor can test the control over the reconciliation by reviewing the reconciliation statement prepared by the computer. The auditor can review the vendor’s document and assess whether all the transactions are recorded in the reconciliation statement.
2	The auditor can test the control by randomly checking the entries in the receiving report. The auditor can randomly pick a few consecutive transactions and consider that their numbers are in sequence.
3	The auditor should review the mailing register and review the signature for the individual who mailed the checks.

Answer 13

b.

To determine

Provide the test of control for the provided internal control of the client.

Answer 14

b.

Expert Solution

Explanation of Solution

Test of control:

Test of control is performed by the auditor to verify that the control process is effective and efficient enough or not. It consists of the following two activities:

Test of control recognizes the control process required to prevent the material misstatement.
Test of control asses that the control process is operating effectively or not.

Provide the test of control for the provided internal control of the client:

Control	Tests of Controls
1	The auditor can test the control over the reconciliation by reviewing the reconciliation statement prepared by the computer. The auditor can review the vendor’s document and assess whether all the transactions are recorded in the reconciliation statement.
2	The auditor can test the control by randomly checking the entries in the receiving report. The auditor can randomly pick a few consecutive transactions and consider that their numbers are in sequence.
3	The auditor should review the mailing register and review the signature for the individual who mailed the checks.