Chapter 6 6-43 & 6-45

Chapter 6 6-43 & 6-45 - 6.43 Tests of Controls over...

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6.43 Tests of Controls over Cash Disbursements NOTE TO STUDENTS: Procedure #2 below is designed to indicate that work on one sample of cash disbursements can produce evidence related to several objectives. The tasks numbered 2a through 2l all relate to the #2 sample items. AUDIT PROGRAM OF TEST OF CONTROLS AUDIT PROCEDURES Management Assertion Test of Controls Procedur e 1. Observe who has custody of signed checks for evidence of segregation of duties from persons having cash disbursement or accounts payable record-keeping responsibilities and from persons who have cash disbursement authorization responsibilities. Occurrence assertion Recorded disbursements are valid and documented--- representing payment for goods and services received. 2. Select a sample of cash disbursements recorded during the period, and 2a. Compare to the cancelled check. 2b. Examine for authorized signature and proper endorsement matching payee name. 2c. Compare recorded amount and check amount. 2d. Compare recorded payee name and name on check. 3. Scan the recorded cash disbursements for large or unusual amounts and perform the same work on these items as in the #2 sample. Occurrence assertion Cash disbursements are authorized according to company policy. 2e.
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This note was uploaded on 04/01/2011 for the course ACCT 413 taught by Professor Kickham during the Spring '11 term at Saginaw Valley.

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Chapter 6 6-43 & 6-45 - 6.43 Tests of Controls over...

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