An Organization's Policies Allow Buyers to Authorize Expenditures Up to $50,000

question 184

Multiple Choice

An organization's policies allow buyers to authorize expenditures up to $50,000 without any other approval. Which of the following audit procedures would be most effective in determining if fraud in the form of payments to fictitious companies has occurred?

• A) Use generalized audit software to list all purchases over $50,000 to determine whether they were properly approved.
• B) Develop a snapshot technique to trace all transactions by suspected buyers.
• C) Use generalized audit software to take a random sample of all expenditures under $50,000 to determine whether they were properly approved.
• D) Use generalized audit software to select a sample of paid invoices to new vendors and examine evidence that shows that services or goods were received.

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Definitions:

Race And Ethnicity

Categories used to classify and differentiate individuals based on physical characteristics, cultural practices, and ancestry.

Blauner's Work

A reference to the contributions of sociologist Robert Blauner, particularly his studies and theories related to alienation, race relations, and industrial sociology.

Park's Theory

A concept developed by sociologist Robert Park that emphasizes the influence of ecological factors on social organizations and human behaviors within urban environments.

Assimilating

The process by which individuals or groups adapt to and incorporate the customs, values, and culture of another group.