Examine the flowchart for purchases and do the following:

a. Identify the sections of the flowchart and for each section write an accompanying narrative of the document flows.

b. Supply answers and comments to the internal control questionnaire for purchases controls shown below.

c. From a review of the flowchart, the narrative description, and the questionnaire, identify as many control activities as you can. Identify the financial statement assertion or assertions to which each control relates.

Transcribed Image Text:

STORES PURCHASING DEPARTMENT RECEIVING ROOM CONTROLLER'S DIVISION Prepare purchase requisition Purchase requisition By requisi tion No. Purchase order Purchase requisition Match purchase order and requisition, 3 Purchase requisition Preparation of purchase order To vendor Purchase order Purchase requisition Match purchase order and requisition Purchase order Requisition 5 Purchase order Requisition By purchase order, Purchase requisition 2 By requisi- tion No Purchase order 3 By purchase, order Purchase order 3 Prepare receiving report Purchase order Receiving report 3 Purchase order By vendor Purchase order