Question: In achieving adequate internal control over operations of the accounts
In achieving adequate internal control over operations of the accounts payable department, a company should establish procedures that will ensure that extensions and footings are proved on all invoices and that the propriety of prices is reviewed. What is the most effective means of assuring consistent performance of these duties?
Answer to relevant QuestionsWhat internal control activity would you recommend to call attention to a failure to pay invoices within the discount period?What is the principal reason for testing the reasonableness of the Interest Expense account in conjunction with the verification of notes payable?Does incorrect required supplemental information included with audited financial statements result in a qualified or adverse audit opinion? Explain.Can the client change a set of financial statements to receive an unmodified opinion instead of an opinion qualified as to the adequacy of disclosure? Explain. What form of opinion will the auditors normally issue with respect to summary financial statements that the client has developed from the audited financial statements?
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