The following are misstatements that can occur in the sales and collection cycle:
misstatements
1. a customer number on a sales invoice was transposed and, as a result, charged to the wrong customer. by the time the error was found, the original customer was no longer in business.
2. 1a former computer operator, who is now a programmer, entered information for a fictitious sales return and ran it through the computer system at night. when the money came in, he took it and deposited it in his own account.
3. a nonexistent part number was included in the description of goods on a shipping document. therefore, no charge was made for those goods.
4. a customer order was filled and shipped to a former customer, that had already filed for bankruptcy.
5. the sales manager approved the price of goods ordered by acustomer, but he wrote down the wrong price.
6.a computer operator picked up a computer-based data file for sales of the wrong week and processed them through the system a second time.
7. for a sale, a data entry operator erroneously failed to enter the information for the salesman's department. as a result, the salesman received no commission for that sale.
8. several remittance advices were batched together for inputting. the cash receipts clerk stopped for coffee, set them on a box, and failed to deliver them to the data input personnel
requirements
a. identify the transaction-related managementassertion(s) to which the misstatement pertains.
b. identify one automated control that would have likely prevented each misstatement.
misstatement
1-thur 8 match to the option
requirement a choices has 9 options requirement b has 6 options
transaction related management assertions computer based control
accuracy check digital
classification scheduling of computer processing
completeness conversion verification
completeness / accuracy cutoff procedures
completeness / cutoff preprocessing review
cutoff control totals reconciled to manual
occurrence / accuracy
occurrence / cutoff