I have attached the problem i have been working on. Everyone shows you how to complete part 1, but I need help with part 2-deficiencies....Thanks!

10-43 (Objective 10-5) In Parts I and II of this case, you performed preliminary analytical procedures and assessed acceptable audit risk and inherent risk for Pinnacle Manufacturing. Your team has been assigned the responsibility of auditing the acquisition and payment cycle and one related balance sheet account, accounts payable. The general approach to be taken will be to reduce assessed control risk to a low level, if possible, for the two main types of transactions affecting accounts payable: acquisitions and cash disbursements. The following are furnished as background information: A summary of key information from the audit of the acquisition and payment cycle and accounts payable in the prior year, which was extracted from the previous audit firm's audit files (Figure 10-12) A flowchart description of the accounting system and internal controls for the acquisition and payment cycle (Figure 10-13,p. 334)the flowchart shows that although each of the company's three divisions has its own receiving department, the purchasing and accounts payable functions are centralized The purpose of Part III is to obtain an understanding of internal control and assess control risk for Pinnacle Manufacturing's acquisition and cash disbursement transactions. Required a. Familiarize yourself with the internal control system for acquisitions and cash disbursements by studying the information in Figure 10-12 and Figure 10-13. FIGURE 10-12 Information for Audit of Accounts Payable Previous Year b. Prepare a control risk matrix for acquisitions and a separate one for cash disbursements using Figure 10-5 on page 308 as a guide. A formatted control risk matrix is provided on the textbook Web site. The objectives should be specific transaction-related audit objectives for acquisitions for the first matrix and cash disbursements for the second matrix. See pages 608-612 in Chapter 18 for transaction-related audit objectives for acquisitions and cash disbursements. In doing Part III, the following steps are recommended: (1) Controls a. Identify key controls for acquisitions and for cash disbursements. After you decide on the key controls, include each control in one of the two matrices. b. Include a \"C\" in the matrix in each column for the objective(s) to which each control applies. Several of the controls should satisfy multiple objectives. (2) Deficiencies a. Identify key deficiencies for acquisitions and for cash disbursements. After you decide on the deficiencies, include each significant deficiency or material weakness in the bottom portion of one of the two matrices. Control Risk Matrix for Acquisitions For purchasing goods, accounting activities and disbursement of cash should be separated There should be unique identifiable and traceable and periodically accounting for purchase order or purchase transaction Posting and Timing Classificati on Accuracy Completen ess Transaction-Related Audit Objectives Existence Internal Controls C C C There should be a separate department for processing procurement request and this request should be properly approved by purchasing department. C Unless and until the actual goods are received transaction should not be generated and if generated adequate and verified proof or evidence should be attached. C Receiving transaction record C C C C C C C C C or information should be maintained in receiving department only and periodically made available to the account payable department for processing payment of suppliers. Safeguarding of the goods is very important. Physical receiving of goods should be handed over to the separate person other than the person maintaining receiving records. C C Before processing C the payment there should be proper verification of purchase order and receiving report for the particular invoice in accordance with price, quantity, terms for payment and to every invoice authenticated and approved evidence or proof should be attached. C C Aged or unmatched purchase order, receiving transaction and invoices should be reviewed, C C C investigated and resolved periodically. There should be C proper authorization and documenting of debit and credit memos in accordance with management authorization listings. C The Accounts payable should be approved with the authenticated supplier's listing and database before processing the payment. C C Assessed Control Risk Low Low C C C C C C C Low Low Low Low