Question: In testing controls, the auditor can obtain evidence from analyzing data in a visual form. In your audit procedure, you test to see if there

In testing controls, the auditor can obtain evidence from analyzing data in a visual form. In your audit procedure, you test to see if there are customers that have been sent invoices who do not have sufficient credit authorization. You also want to determine how much the total value of invoices that have exceeded the credit limit.

  1. This control seems to fail to record authorization of the sale when the invoices for the month exceed the credit limit, but it does not prevent the sale. Why do you think that the control functions this way? What would you say in your management representation letter?

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