WK 5- payables

Question 1

PRESNETATION AND DISCLOSURE - payables

Answer 1

DOESS IT ADD UP, IS everything classified correctly
ratios
opening balances -

Question 2

accuracy, classifaction, vaulation payables

Answer 2

inc statement 2027 had wrong figures for 2026 ( had 2025 instead)- rev, cogs , gross

Question 3

rights and obligatios payables

Answer 3

payables and recieavbles
leasing assets

Question 4

completeness and cut off payables

Answer 4

recorded in same accounting period
recorded in full- look at sequence

Question 5

exisitence or occurrence payables

Answer 5

does it exist? can i go find it in the warehouse

Question 6

how to confirm accounts
payables

Answer 6

select sample
confirm with client- mabye he will say no
send confirmation request
record replies on control sheet
send a follow up letter for no replies
follow alt proceudres for bad respons or no respon
sum it up

Question 7

5 examples of inherent risk affect payables

Answer 7

1. fraud risk- lack of seg
2. errors in recording and classifcstion- incorrect posting of invoices
3. completeness and cutoff- vendor relationship, preferntail treatment
4. legal and reg compliance- tax, right accounting period
5. increase in trade payable days

Question 8

5 asserttions related to accoutnts payable and purch

Answer 8

1. existence and occurence- vailidate the accounts- purch orders match accounts in fs
2. completeness these reports are full in fs, make sure no unrecorded
3. valaution and allocation- right amount, confirm with creditors in right accounting period
4. rights and obligation - verify if they have right to goods
5. disclosure and presentation - right classfication, right accounting standards GAAP

Question 9

5 audit test that would be carried out payables

Answer 9

test of details- purch transactions = sample, verify accracy and completeness of recorded purch- invocies (ledger)

test of completeness- accounts payable- reviewing creditro statments and how they relate to purch

conformation of accounts payable- seeing if the amount that is owed in the books is the acutal ,by phoing

cut off test- correct accounting period- review puch invocies

analytical preciedures- assess reasonablesnness of purch and account pay balances, comparing with last year figures, finding out payable days, how has that cahnged

Question 10

5 controls operated in relation to Sheridan n accounts payables

Answer 10

regular review of supplier statements- reg comp amounts in gdn agasinst purchase order

purchase account reconcialtion- purch day book total into purchase ledger and purchase account

seg of duties- recording should be different+ recieving it

purch authorisation control- authorized before recorded

completenes, prenumbered sheets - verifiying accruacy and completeness of invoices- match to sales order-