"Observe If Personnel in the Purchasing Department Are Following Company

question 4

Multiple Choice

"Observe if personnel in the purchasing department are following company policies" is an audit procedure intended to test which control objective?

• A) Environment.
• B) Accuracy.
• C) Validity.
• D) Proper period cutoff.

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Definitions:

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations with its current assets over its current liabilities.

Current Assets

Current assets are assets that a company expects to convert into cash, sell, or consume within one year or within its operating cycle if longer than a year.

Vertical Analysis

A financial analysis method that compares various line items in a company's financial statements over a single period, expressing each item as a percentage of a base amount to assess relative size and structure.

Comparative Financial Statements

Financial statements that present financial information for different periods or dates side by side to facilitate comparison.