As part of the investigation of accounts payable, auditors sometimes vouch entries in selected creditors’ accounts back through the journals to original documents, such as purchase orders, receiving reports, invoices, and paid checks. What is the principal purpose of this procedure?
Answer to relevant QuestionsWhitehall Company records its liabilities in an accounts payable subsidiary ledger. The auditors have decided to select some of the accounts for confirmation by direct communication with vendors. The largest volume of ...What differences should auditors expect to find in supporting evidence for accrued liabilities as contrasted with accounts payable?In addition to verifying the recorded liabilities of a company, the auditors should also give consideration to the possibility that other unrecorded liabilities exist. What specific steps may be taken by the auditors to ...Name three situations that might place a restriction on retained earnings, limiting or preventing dividend payments. Explain how the auditors might become aware of each such restricting factor. Robert Hopkins was the senior office employee at the Griffin Equipment Company. He enjoyed the complete confidence of the owner, William Barton, who devoted most of his attention to sales, engineering, and production ...
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