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A. Purchases are made against blanket or open purchase orders for certain types of items.
B. There is a failure to rotate purchases among suppliers included on an approved vendor list.
C. Purchase specifications are developed by the department requesting the material.
D.Purchases are made from parties related to buyers or other company officials.
d
D. shall be considered a risk at financial statement level, as procedures must be actioned to ensure transactions are conducted at arms-length, otherwise additional disclosure will be required to the notes to the financial statements.
Option D
D.Purchases are made from parties related to buyers or other company officials... would be the biggest one ... not good dealing with relatives ... one could be accused of favoritism or being corrupt
My guess is option (d) for an answer.
D. Purchases are made from parties related to buyers or other company officials
But likes to be within
Design audit procedures that are capable to reduce audit risk.
Define the concept of risk necessary for audit work and the responsibility of the auditor of them.
Determine the accounting system and internal control system.
Clarify the concept of risk and the responsibility of the discovery of which the auditor.
(D) is the correct answer.
