P13-4) 1.

The control plan that would best address this situation is match invoice, purchase order, and receiving report. In this case, had the data entry clerk been required to match the invoice being paid with the purchase order found in the system, the error of posting the invoice to the incorrect vendor would have been prevented. With this control plan in place the system would have alerted the clerk that a payment to an invoice was about to be posted to a vendor that differed from the vendor on the purchase order. 2. In this case of the lost invoiced, the control plan that would have best prevented this from occurring is having a tickler file of open purchase orders and receiving reports. Upon following up on open purchase orders it would have been discovered that these orders had not been invoiced and/or paid and would have alerted the payables department of the error. 3. The agreement of run-to-run totals control plan should have been utilized in this case. Had the test of validity been run, before the cash was disbursed it would have identified payments that exceeded the authorized amount. 4. The cash planning control would be effective in avoiding premature planning of payables. If this control is used the payables department will be able to carefully review and plan a schedule of payments. 5. An agreement of run-to-run totals would have determined if the invoices received were truly applicable to receipts of goods and/or services. In this case, the invoice would not have been paid when it was discovered there was no service or goods to be invoiced for. 6. Using the run-to-run totals of vendor invoice input validity would have prevented vendor invoicing error. By confirming the initially contract unit price with the invoiced unit price, this error would not have occurred and the A/P department could have disputed the pricing. 7. The agreement of run-to run totals, specifically the vendor invoice input completeness and accuracy check would have prevented the invoice being paid twice. Upon receipt of the invoice the program would have found an invoice already in the system against the PO. Therefore, further investigation would have determined the invoice (which likely would have had the same invoice number) was already paid. 8. The cash planning report would identify the aging accounts will balances remaining. This would have shown balances on accounts that were actually paid and would have identified accounts with errors for correcting journal entries to be made for the ledger. 9. The match invoice, purchase order and receiving report would have alerted clerks that the invoices were being sent without proper documentation of offsetting goods received. 10. The tickler file of payments due should be used to identify which purchase orders have been followed up with actual goods received. These purchase orders should be identified by date to determine if payments have been made and how long the company has been pending an invoice. P13-7) 1. D 2. I

3. K 4. H 5. A 6. J 7. F 8. B 9. L 10. E