The following misstatements are included in the accounting records of Clinton Manufacturing Company Each month, a fraudulent receiving report is submitted to accounting by an employee in the receiving department A few days later, he sends Clinton an invoice for the quantity of goods ordered from a small company he owns and operates in the evening A check is prepared, and the amount is paid when the receiving report and the vendors invoice are matched by the accounts payable clerk Telephone expense (account 1113) was unintentionally charged to repairs and maintenance (account 1131) The accounts payable clerk prepares a monthly check to Mandy Supply Company for the amount of an invoice owed and submits the unsigned check to the treasurer for payment along with related supporting documents that have already approved When she receives the signed check from the treasurer, she records it as a debit to accounts payable and deposits the check in a personal bank account for a company named Mandy Company A few days later, she records the invoice in the acquisitions journal again, resubmits the documents and a new check to the treasurer, and send the check to the vendor after it has been signed The amount of a check in the cash disbursements journal is recorded as $5162 87 instead of $6512 87 The accounts payable clerk intentionally excluded from the cash disbursements journal seven large check written and mailed on Dec 25 to prevent cash in the bank from having a negative balance on the general ledger They were recorded on Jan 5 of the subsequent year Acquisitions of raw materials are often not recorded until several weeks after the goods are received because receiving personnel fail to forward receiving reports to accounting When pressure from a vendors credit department is put on Clintons accounting department, it searches for the receiving report, records the transactions in the acquisitions journal and pays the bill Required For each misstatement, identify the transaction related audit objective that was not met (2 marks) For each misstatement, state a control that should have prevented it from occurring on a continuing basis (3 marks) For each misstatement, state a substantive audit procedure that could uncover it (3 marks)

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The following misstatements are included in the accounting records of Clinton Manufacturing Company: Each month, a fraudulent receiving report is submitted to accounting by an

The following misstatements are included in the accounting records of Clinton Manufacturing Company:

Each month, a fraudulent receiving report is submitted to accounting by an employee in the receiving department. A few days later, he sends Clinton an invoice for the quantity of goods ordered from a small company he owns and operates in the evening. A check is prepared, and the amount is paid when the receiving report and the vendors invoice are matched by the accounts payable clerk.
Telephone expense (account 1113) was unintentionally charged to repairs and maintenance (account 1131).
The accounts payable clerk prepares a monthly check to Mandy Supply Company for the amount of an invoice owed and submits the unsigned check to the treasurer for payment along with related supporting documents that have already approved. When she receives the signed check from the treasurer, she records it as a debit to accounts payable and deposits the check in a personal bank account for a company named Mandy Company. A few days later, she records the invoice in the acquisitions journal again, resubmits the documents and a new check to the treasurer, and send the check to the vendor after it has been signed.
The amount of a check in the cash disbursements journal is recorded as $5162.87 instead of $6512.87.
The accounts payable clerk intentionally excluded from the cash disbursements journal seven large check written and mailed on Dec.25 to prevent cash in the bank from having a negative balance on the general ledger. They were recorded on Jan.5 of the subsequent year.
Acquisitions of raw materials are often not recorded until several weeks after the goods are received because receiving personnel fail to forward receiving reports to accounting. When pressure from a vendors credit department is put on Clintons accounting department, it searches for the receiving report, records the transactions in the acquisitions journal and pays the bill.

Required:

For each misstatement, identify the transaction-related audit objective that was not met. (2 marks)
For each misstatement, state a control that should have prevented it from occurring on a continuing basis. (3 marks)
For each misstatement, state a substantive audit procedure that could uncover it. (3 marks)