shifting expenses A municipality typically uses encumbrance accounting. The annual budget establishes a spending eeiling for each
Question:
shifting expenses A municipality typically uses encumbrance accounting. The annual budget establishes a spending eeiling for each category. Expenses are then recorded as quickly as possible. For example, in the case of major supplies, the supplies account is debited when a purchase order is plaeed; minor supplies, where no purchase order is required, are reeorded as soon as a supplier invoice arrives. This aggressive reeognition is designed to ensure an authorization limit is not exceeded.
In a recent fraud, a munieipal department instrueted a supplier to post date invoices so they would signal aequisitions in the succeeding as opposed to eurrent year. Whieh items on the internaI controis eheeklist are violated here?AppendixLO1
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