CS Professional · Internal and Forensic Audit · Internal Audit of Specific Functions
An internal auditor wants to confirm that goods for which Sundaram Engineering Ltd was invoiced were actually received. Which document should the auditor primarily match against the supplier invoice and purchase order (three-way match)?
The goods received note should be matched with the purchase order and supplier invoice. This three-way match confirms that the items ordered were actually received in the quantity and condition billed before payment is released, preventing payment for goods never delivered.
- AGoods received noteCorrect
- BVendor's bank statement
- CBoard minutes of approval of budget
- DSales order from the customer
Explanation
Three-way matching compares the purchase order, the goods received note and the supplier invoice. The GRN is the evidence of physical receipt. Bank statements show payment, not receipt of goods.
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