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You have just been assigned as a member of the audit team of Bozarkana Company (a new client) and are considering accounts payable. Bozarkana Company

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You have just been assigned as a member of the audit team of Bozarkana Company (a new client) and are considering accounts payable. Bozarkana Company uses a computerized voucher system for payables. As a starting point, you asked Bill Bozarkana, the controller, for a summary of payables and received the following schedule of more than 1,000 unpaid vouchers at year-end: $ Voucher# 2334555 2334558 2334567 Vendor Number 2133 1098 2133 Purchase Order# 654444 654579 654593 Receiving Report# 106500 106820 106920 Date Payment Due 1/2/0Y 1/2/07 1/2/0Y Amount 2,020,21 12,344.56 322.43 655456 107654 1/28/OY 2335643 2231 TOTAL PAYABLE 2,346.62 $2,225,980.83 File Name Information in Table Comment The table includes one row for each purchase requisition-only one type of item per requisition may be requisitioned. Purchase Purchase requisition number requisitions Date requisitioned Item number Item description Quantity one for each item Purchase orders The table includes multiple rows for each purchase order ordered Purchase order number Date ordered Purchase requisition number Vendor number Item number Quantity Cost Receiving reports The table includes multiple rows for each receiving report--one for each item received Receiving report number Date shipped Date received Item number Quantity Vendor The table includes one line for each vendor. master Vendor number Vendor name Vendor address The table includes one line for each check or funds transfer (electronic payment). Cash Disbursement number disbursementendor number Check number or electronic funds transfer number Voucher number Amount The client has made copies of these files available so that you and the assistant can perform the necessary steps on the files. Furthermore, you have compared these copies to the client's copies and find that they are identical. Finally, you may assume that tests of controls have been performed on the controls related to the dates on the files. The controls were found to be effective. a. Discuss how you would establish samples in the following situations: (1) Randomly select 30 vouchers as of year-end and obtain the necessary information to send confirmations. (3) Randomly select 30 accounts with balances payable (per vendor) as of December 31. Select all accounts (per vendor) with which the company has disbursed more than $500,000 during the year, but whose balance at year-end is zero. b. Provide detailed guidance on the following: (1) All purchases are sent to Bozarkana Company "FOB shipping point." Identify a procedure for testing whether any items shipped to the client prior to year-end have been omitted from vouchers payable as of year-end. (2) Select all disbursements over $300,000 in the first two weeks of January, and, for those not included as liabilities as of December 31, determine whether title to the goods had passed as of year-end, resulting in an unrecorded liability

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