Case 3. Zaki Credits-$130,000 in credits based on 35 credit memoranda from Zaki, Inc., were purportedly for the return of overstocked goods from several Nefret stores. An Abdul & El-Emir staff auditor noted the size of the credit and that the credit memos were dated subsequent to year-end. He further noticed that a sentence on the credit memos from Zaki had been obliterated by a felt-tip marker. When held to the light, the accountant could read that the marked-out sentence read, Do not post until merchandise received. The staff auditor thereafter called Omar Zaki, treasurer of Zaki, Inc., and was informed that the $130,000 in goods had not been returned and the money was not owed to Nefret by Zaki. Abdullah, president of Nefret, advised Hussein, audit partner, not to have anyone call Zaki to verify the amount because of pending litigation between Nefret and Zaki, Inc.

Identify deficiencies in the sufficiency and appropriateness of the evidence gathered in the audit of accounts payable of Nefret Stores.