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why should acct department make Authorization in Audit4


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#1 Kai

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Posted 25 May 2014 - 07:54 AM

Hello everyone, I was reviewing the Becker book for Audit exam. In A4-27 expenditure cycle it says that when the invoice arrives, the acct department approves it by matching docs ... Wouldn't that be a violation of segregation of duties cause acct dep. also records the payable? How does it look like in real practice? Thanks.



#2 Gerry

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Posted 19 June 2014 - 07:09 PM

Hello everyone, I was reviewing the Becker book for Audit exam. In A4-27 expenditure cycle it says that when the invoice arrives, the acct department approves it by matching docs ... Wouldn't that be a violation of segregation of duties cause acct dep. also records the payable? How does it look like in real practice? Thanks.

My experirence working as an AP accountant is that the Accounting Dept is the least likely to know if the invoice is correct and should be paid.  Usually the department that ordered the goods/services reviews the invoice to make sure they are correctly being billed for the services the ordering department asked for.  That department authorizes payment and then sends the invoice to accounting for processing.  The accounting department might match documents as a way of doublechecking the amounts, but the ulaimte authority to pay the invoice does not lie with the AP clerk.