COMM 455 Lecture Notes - Lecture 17: Gross Profit, Accounts Payable
Document Summary
Accuracy: overpaid, don"t do work, and on the payroll for long time. E. g. professor at langara got paid when he wasn"t teaching the class. E. g. pay you in cash so that you would spend it in store. Table 10. 4 control risk assessment payroll transactions. Substantive procedures: audit accounts payable, subsidiary ledger must reconcile to gl if problem: understated, outstanding but didn"t record, vouch payable back to related invoice, search for unrecorded liabilities e. g. dec 31 (y/e) a/p 240,000. On feb 14 (to complete audit: look through all o/s payables, identify invoices dec 31 and before should be included in a/p, if not then problem, look at payments made between jan 1 and feb 14. Co: does not want to increase a/p, won"t accrue it, pay in jan, auditor won"t catch error e. g. payment of nov 30 invoice. Case 1 it is on the dec 31 a/p list - correct.
