While Performing an Internal Audit Engagement, an Auditor Reviews a Flowchart

question 1

Multiple Choice

While performing an internal audit engagement, an auditor reviews a flowchart of the organization's purchasing function. Which of the following internal control weaknesses would the auditor be able to identify in the chart?

• A) That purchasing policies have not been updated.
• B) That supplier invoices are processed and paid before the goods are received.
• C) That the organization is not taking advantage of quantity discounts available from its suppliers.
• D) That authorization for payment of goods received has not been granted at the appropriate level.

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Definitions:

Inference Forms

Inference forms refer to the logical structures that showcase how conclusions are derived from premises.

MP

Abbreviation for Modus Ponens, a form of argument where if 'P implies Q' and 'P' is asserted to be true, then 'Q' must be true.

Inference Forms

Patterns or structures of logical reasoning that derive conclusions from premises based on rules.

MP

An abbreviation for Modus Ponens, a form of argument in logic where if a conditional statement ("if P, then Q") is accepted, and the antecedent P holds, then the consequent Q logically must also hold.