In reviewing items recorded as purchases of goods, an auditor noticed 3 purchases from JK Company Inc. The auditor had selected these items and noticed that each of these 3 transactions were purchases of the same goods that the client had sold to JK just 4 days before the client's year end. The prices charged in the sale and purchase transactions were equal, but the transactions were not recorded as returned goods. In order to identify related parties, the auditor made enquiries of management and reviewed the minutes of board of directors' meeting, but had not discovered that JK was a related party by these procedures.

Required: Identify the circumstances that would suggest to the auditor that JK might be a related party to the client.