a, b and c Explanation The weakness in the process and recommendations are given below: Error \ Fraud Procedure to prevent such occurrences Evidence used by auditor Fraud The customers must be asked to make payment in checks or online. Trace the sales transactions to cash receipts and reconcile with the accounts receivable. Error Separate persons must prepare and post the invoices. Test the accuracy of the sales invoices. Fraud Prelisted cash receipts must be compared with postings in the accounts receivable records and the bank deposit slips. Trace the sales transactions to cash receipts and reconcile with the accounts receivable...

17th Edition

ISBN: 9780134897431

Author: ARENS, Alvin A.

Publisher: PEARSON

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Chapter 10, Problem 26DQP

a, b and c

To determine

Identify the weaknesses in the given process and the recommendations to set them right.

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Chapter 10 Solutions

Auditing And Assurance Services

Ch. 10 - Prob. 1RQ Ch. 10 - Define misappropriation of assets and give two...Ch. 10 - Prob. 3RQ Ch. 10 - Prob. 4RQ Ch. 10 - Prob. 5RQ Ch. 10 - Prob. 6RQ Ch. 10 - Prob. 7RQ Ch. 10 - Prob. 8RQ Ch. 10 - Prob. 9RQ Ch. 10 - Prob. 10RQ

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There are several elements to internal controls. Which of the following would not address the issue of having cash transactions reported in the accounting records? A. One employee would have access to the cash register. B. The cash drawer should be closed out, and cash and the sales register should be reconciled on a prenumbered form. C. Ask customers to report to a manager if they do not receive a sales receipt or invoice. D. The person behind the cash register should also be responsible for making price adjustments.
In a cash receipts journal, both the Accounts Receivable Credit column and the Cash Debit column were mistakenly underadded by 700. How will this error be discovered?

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