Reference no: EM131570994

Question - You are a staff accountant and have been assigned to perform the audit of Immanuel Klein Ltd. The interim audit is taking place and you have just completed your understanding of the internal controls over the acquisition and payment cycle. You noted the controls are reasonably good and this year the plan is to rely on the internal controls and to reduce the amount of substantive testing for this cycle.  In order to assess the control risk you select 40 transactions for testing.  In your tests you discover the following exceptions:

1) Two items in the acquisition journal have been misclassified.

2) Five receiving reports were recorded in the acquisition journal at least two weeks later than their date on the receiving report.

3) One invoice had been paid twice

4) One cheque amount in the cash disbursements journal was for $100 less than the amount stated on the vendor's invoice.

5) One voided cheque was missing

6) Two receiving reports for vendor's invoices were missing from the transaction packet.

Required - Identify an internal control that should have prevented each misstatement.