Which of the following is a procedure used in an audit where there is a heightened risk of fraud related to accounts payable and other related expense accounts?
A)Send blank confirmations to vendors that ask them to furnish information about all outstanding invoices,payment terms,and payment histories.
B)Scan journals for unusual or large year-end transactions and adjustments.
C)Obtain and examine documentation for payments of invoices that are for amounts just under the limit that typically requires some level of approval.
D)All the above.

Question

Quizplus · Accepted Answer

All of these procedures are commonly used in an audit with a heightened risk of fraud related to accounts payable and other related expense accounts. Sending blank confirmations to vendors can help identify fictitious or inflated invoices, scanning journals for unusual or large year-end transactions and adjustments can help identify improper recording of expenses, and obtaining and examining documentation for payments of invoices just under the approval limit can help identify fraudulent payments made to accomplices or fictitious vendors.

Which of the Following Is a Procedure Used in an Audit