Reference no: EM132843477

Problem 1: You are an audit graduate assigned to the XYZ Ltd (XYZ) engagement. You are reviewing your notes documenting the XYZ's control activities from your recent site visit to XYZ. For each of the controls noted, identify the key assertion in relation to the provided account that the control addresses.

A. Payroll expense: Human resources department to notify payroll department of any promotions and their effective dates

B. Accounts payable: Supplier invoices are matched against quantities on receiving reports and contract prices prior to being paid.

C. Travel expense: Travel expenses incurred by each employee are review by the relevant department manager on a monthly basis and compared to employee's calendars and travel plans.

D. Inventory: The warehouse manager undertakes month end stocktakes and ensures that inventory held on consignment are not included in the inventory counts.

E. Accounts receivable: The receivables clerk undertakes a monthly reconciliation of dispatch notes to the receivables ledger to ensure that all customers have invoiced for goods that have been dispatched to them.