CS Professional · Internal and Forensic Audit · Special Points relating to Internal Audit in various Entities
Bharat Logistics Services, a transport service provider, charges customers per trip based on distance and load. An internal auditor suspects that some trips are run and fuel is consumed but no freight invoice is raised. Which comparison best helps detect this?
Compare fuel consumption and driver trip logs with the freight invoices raised for each vehicle and period. These records independently prove that trips were made, so any trip without a matching invoice shows revenue leakage. Ageing analysis or year-on-year comparisons cannot reveal trips that were never invoiced.
- AComparing fuel consumption and driver trip logs with freight invoices raised for the same vehicles and periodCorrect
- BComparing freight invoices with the previous year's invoices
- CComparing the office rent with the lease agreement
- DComparing the trade receivables ageing with the credit policy
Explanation
Fuel issues and trip sheets are independent evidence that trips took place. Matching them with invoices shows trips with no invoice. Ageing and year-on-year invoice comparison do not identify missing invoices, and rent is unrelated.
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