AUD Question. Super confused. Please help.

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  • #2863155 Reply
    Nini
    Participant

    Why Clerk 2 is not the answer? I thought reconciliation can't be done by someone who handles accounting records and “enters vendor invoices into the accounting system” is definitely “recording”

    A company employs three accounts payable clerks and one treasurer. Their responsibilities are as follows:

    Employee Responsibility
    ——– —————————————————–
    Clerk 1 Reviews vendor invoices for proper signature approval
    Clerk 2 Enters vendor invoices into the accounting system and
    verifies payment terms
    Clerk 3 Posts entered vendor invoices to the accounts payable
    ledger for payment and mails checks
    Treasurer Reviews the vendor invoices and signs each check
    Which of the following would indicate a weakness in the company's internal control?

    Incorrect A.
    Clerk 1 opens all of the incoming mail.

    B.
    Clerk 2 reconciles the accounts payable ledger with the general ledger monthly.

    C.
    Clerk 3 mails the checks and remittances after they have been signed.

    D.
    The treasurer uses a stamp for signing checks.

    Correct answer = C.

    AUD - 77
    BEC - 78
    FAR - 81
    REG - 84
    Finally done!!!
    #2863944 Reply
    AndreAAndreA
    Participant

    Remember about segregation of duties: Custody of assets, record-keeping and authorization. The best answer is C, Clerk 3 have two responsibilities: Record-keeping and custody, which is not good.

    FAR - 73, 78 (WileyCPAexcel 3,000+ MCQs, 50 SIMs)
    AUD - 73, 81 (WileyCPAexcel 3,000+ MCQs, 40 SIMs)
    BEC - 71, 71, 74 My life is a fucking joke.
    REG - 84 (WileyCPAexcel 2,000 MCQs, 15 SIMs)

    "Of course it’s hard. It’s supposed to be hard. If it was easy, everyone would do it.

    #2865480 Reply
    Nini
    Participant

    Thank you Andre. Can you explain why clerk#2 is ok?

    AUD - 77
    BEC - 78
    FAR - 81
    REG - 84
    Finally done!!!
    #2865690 Reply
    PuppykoalaPuppykoala
    Participant

    My understand:
    Both 1 and 2 are in the “record-keeping” duty range. 3 is “custody of asset” since he/she mails checks. 3's duty should be performed by an employee independent of AP.
    Clerk 2 doesn't custody nor authorize anything so there is no reason for it to be a weakness.

    Shoot for the stars!

    FAR 88 04/19

    REG 95 07/19

    BEC 91 11/19

    AUD 88 12/19

    #2890623 Reply
    typark
    Participant

    Do not stick to the word “Reconciliation”. The meaning of prohibited reconciliation with other duties can be applied to the cash and “bank reconciliation” not the payable account. In this question, the 2nd clerk seems like an employee of the accounts payable department. The A/P department worker should post and reconcile the payable ledger in the accounting system.

    #2890734 Reply
    Nini
    Participant

    Thank you all for replying. I just took AUD yesterday and felt i did “ok”.

    AUD - 77
    BEC - 78
    FAR - 81
    REG - 84
    Finally done!!!
    #2891133 Reply
    AndreAAndreA
    Participant

    Good luck! What do you think about SIMs, any topics you wish you could study better?

    FAR - 73, 78 (WileyCPAexcel 3,000+ MCQs, 50 SIMs)
    AUD - 73, 81 (WileyCPAexcel 3,000+ MCQs, 40 SIMs)
    BEC - 71, 71, 74 My life is a fucking joke.
    REG - 84 (WileyCPAexcel 2,000 MCQs, 15 SIMs)

    "Of course it’s hard. It’s supposed to be hard. If it was easy, everyone would do it.

    #2891157 Reply
    Nini
    Participant

    Thanks Andre. If i have to take it again, I will definitely spend more time on Sampling.

    AUD - 77
    BEC - 78
    FAR - 81
    REG - 84
    Finally done!!!
    #2891313 Reply
    AndreAAndreA
    Participant

    My favorite topic 🙂 You're going to get 80+ no more samplings for you.

    FAR - 73, 78 (WileyCPAexcel 3,000+ MCQs, 50 SIMs)
    AUD - 73, 81 (WileyCPAexcel 3,000+ MCQs, 40 SIMs)
    BEC - 71, 71, 74 My life is a fucking joke.
    REG - 84 (WileyCPAexcel 2,000 MCQs, 15 SIMs)

    "Of course it’s hard. It’s supposed to be hard. If it was easy, everyone would do it.

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