Mini-Case Analysis Authorization of transactions is considered a key role in most organizations. Authorizations should not be made by individuals who have incompatible functions: Required:Indicate the individual or function (e.g. the head of a particular department) that should have the ability to authorize each if the following transactions. Briefly indicate the rationale for your answer. Writing off old accounts receivablePaying the employee for overtimeShipping goods on account to a new customerTemporarily investing funds in common stock investments instead of money market fundsRewriting the company’s major computer programs for processing purchase orders and accounts payable (the cost of rewriting the program will represent one quarter of the organization’s computer development budget for the year.

Authorization of transactions is a process in which the authority to complete transactions is…

Answered: Indicate the individual or function…

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter3: Internal Control Over Financial Reporting: Responsibilities Of Management And The External Auditor

Section: Chapter Questions

Problem 19RQSC: Authorization of transactions is a key control in most organizations. Authorizations should not be...

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Mini-Case Analysis

Authorization of transactions is considered a key role in most organizations. Authorizations should not be made by individuals who have incompatible functions:

Required:

Indicate the individual or function (e.g. the head of a particular department) that should have the ability to authorize each if the following transactions. Briefly indicate the rationale for your answer.

Writing off old accounts receivable
Paying the employee for overtime
Shipping goods on account to a new customer
Temporarily investing funds in common stock investments instead of money market funds
Rewriting the company’s major computer programs for processing purchase orders and accounts payable (the cost of rewriting the program will represent one quarter of the organization’s computer development budget for the year.

Definition Definition Financial market that deals in securities or assets that are short-term in nature. The money market is responsible for keeping up the liquidity of the businesses and the organizations. These securities are usually held for a period of 12 months or less and are issued by institutions that require cash or funds for their short-term cash flow requirements. The money market is regulated by the federal government.

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