Question

Al-Around Sound Co. discovered a fraud whereby one of its front office administrative empi vecs used company and to purchase goods, such as computers, digital cameras and other electronic items for her own use. The fraud was discovered when wees noticed an increase in delivery frequency from vendors and the use of unusual vendors. After some investigation, it was discovered that the uld alter the description or change the quantity on an invoice in order to explain the cost on the bill. Answer the following True or False Questions about the company's internal controls. These will assist nur in de m ine the we Purchases should be initiated by a requisition document. BS True EES An accounts payable dark should match the requisition purchase order, and The invoice should have been delivered directly to the accounts payable derk

Answer 1

Anwere 1 :True

Unless backed by a requisition document the invoice generated can be altered and shall no input document to be reconciled with . Proper documentation shall be ensured.

Answer 2: True

The accounts payable clerk should match the purchase order, indent and invoice to ensure that the payment is made for the exact required goods.

Answer 3 : True

There should have been proper seggregation of duties between accounts payable and the one who raises purchase order , requsition etc. to ensure two separate individuals are responsible for different tasks and work done by one person is checked by the other.