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8.

35Prevent and detect controls

For each of the accounts (1 and 2 above) identified to be a significant risk:

(a)determine the key assertion at risk

(b) describe a practical prevent internal control that would directly address the risk

(c) describe a practical detect internal control that Shady Oaks could implementin relation to the
riskAccount at riska.

Assertion at risk a. Assertion at risk b. Prevent internal control c. Detective


internalcontro
A. Payroll Occurrence,accuracy Use different codesfor Review of
expense:overpayment standard shiftsand overtimepayment
ofovertime overtimehours; reports
requirespecialauthorisatio
n ofovertime payments
b. . Accountspayable: occurrence Require supplierand Reconciliation
paymentsmade twice invoice code tobe input at ofsupplier
to thesame supplier time ofprocessingpayment accountseach
systemto reject month, detectdebit
duplicates;Cancel balances
documentsused to oraccounts with
supportpayment to morepayments
preventreuse thaninvoices

8.36 prevent controls

(a) Identify the key assertion at risk for payables in relation to payments madeprior to
receipt of goods.(b) For the control procedures (1) to (5) above for payables:(i) Identify the
key preventative internal control that directly addresses the riskof payments being made by
Shady Oaks to its suppliers before the goods arereceived.(ii) Outline how your choice of the
internal control in (i) will prevent payment tosuppliers prior to receipt of goods.(iii) Design
and describe in detail an appropriate test of control that you woulduse to satisfy yourself
about the effectiveness of this internal control.

(a)Payment to suppliers before goods are received creates the risk that the payment is forgoods
that may never be received, or not received in the relevant period at the pricequoted. The
assertions at risk are the occurrence of the payment of payables. Thecheque has been drawn
against the bank account, but the payment is not for a liabilityowing for goods purchased.
(b)Requiring a receiving report before payment (with appropriately verified details ofdate,
amount, unit price, total price and supplier) mitigates the risk of payment beforereceipt of goods.
The receiving department will not prepare the receiving report untilthe goods are received. The
senior staff member will review the package ofdocuments for evidence of receipt, thus ensuring
that the receiving report is included,and it matches the other documents.

(c)I would review authorised packages of documents for evidence of the existence of
thereceiving report and verify that the details on the receiving report match the otherdocuments
(i.e. the number of goods received is the same as the number of goods onthe suppliers invoice
and purchase order).

A) Pembayaran kepada pemasok sebelum barang diterima menciptakan risiko bahwa


pembayaran forgoods yang mungkin tidak pernah diterima, atau tidak diterima pada periode
yang relevan di pricequoted. Pernyataan berisiko adalah terjadinya pembayaran hutang. cek telah
ditarik terhadap rekening bank, tetapi pembayaran tidak untuk kewajiban karena untuk barang
yang dibeli.

(B) Mewajibkan laporan menerima sebelum pembayaran (dengan tepat diverifikasi rincian
ofdate, jumlah, harga satuan, jumlah harga dan pemasok) meringankan risiko pembayaran
sebelum penerimaan barang. Departemen penerima tidak akan mempersiapkan laporan
menerima sampai barang diterima. Anggota staf senior akan meninjau paket dokumen bukti
penerimaan, sehingga memastikan bahwa laporan penerimaan disertakan, dan itu cocok dengan
dokumen lainnya.

(C) saya akan meninjau paket resmi dari dokumen bukti adanya laporan penerimaan dan
memverifikasi bahwa rincian tentang laporan penerimaan sesuai dengan dokumen lainnya (yaitu
jumlah barang yang diterima adalah sama dengan jumlah barang pada pemasok faktur dan
pesanan pembelian).