You are concerned with unrecorded transactions in the purchasing cycle. Which audit procedure are you most likely to use when auditing purchases?

Question

BlackTom AI · Accepted Answer

Tracing vendor invoices to accounting records directly tests the completeness assertion for purchases and is therefore the most appropriate procedure to detect unrecorded transactions.

1. Relevant knowledge points and concepts
- Unrecorded transactions represent a risk to the completeness assertion: purchases (liabilities/expenses) that occurred but were not recorded will understate expenses and payables.
- Audit procedures: "tracing" follows source documents into the accounting records (tests completeness). "Vouching" follows entries in the accounting records back to source documents (tests existence/occurrence). Recalculation tests mathematical accuracy; confirmations of customer accounts test receivables, not payables/purchases.

2. Complete reasoning process step by step
- Identify source documents for purchases: vendor invoices and receiving reports.
- Select a sample of vendor invoices (especially near period end).
- For each invoice, locate the related receiving report and then follow (trace) the invoice into the purchase journal/ledger and accounts payable subsidiary ledger.
- If an invoice has no corresponding entry, this indicates an unrecorded purchase (completeness failure).
- Tracing from source to ledger proves that events that should be recorded were indeed recorded.

3. Intermediate steps / example
- Sample vendor invoice #123 for $5,000 dated 3/30. Verify receiving report exists. Search purchase journal and AP ledger for a $5,000 entry. If none found, note an unrecorded purchase and recommend adjustment.
- Document evidence: invoice copy, receiving report, and posting evidence (journal entry number).

4. Why the correct answer is correct
- Because the objective is to detect transactions that were not recorded, tracing source invoices into the accounting records is the appropriate method. It directly addresses completeness.

5. Why other options are incorrect
- Vouching tests that recorded transactions actually occurred (occurrence), not whether all occurrences were recorded (completeness).
- Recalculation only verifies arithmetic accuracy of invoices, not whether invoices were recorded.
- Confirmation of customer accounts relates to receivables, not purchases/payables.

6. Conclusion
Therefore the correct audit procedure is tracing vendor invoices to accounting records, which matches the provided answer.

You are concerned with unrecorded transactions in the purchasing cycle. Which audit procedure are you most likely to use when auditing purchases?单项选择题

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