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CMA Final · Cost and Management Audit · Management Audit in Different Functions

In a management audit of the purchasing function, which of the following findings would most directly indicate weak control over the vendor selection process?

Repeated ordering from one supplier without documented quotation comparison or performance ratings most directly shows weak vendor selection control, because sound purchasing needs competitive, evidence-based supplier choice. Serial numbering, normal reporting lines and invoice matching are routine good controls.

  1. APurchase orders are numbered serially and filed by date
  2. BOrders are repeatedly placed with a single supplier without documented comparison of quotations or performance ratingsCorrect
  3. CThe purchase department reports to the materials manager
  4. DGoods received notes are matched with invoices before payment

Explanation

Vendor selection control relies on competitive quotations and supplier evaluation. Repeated single-source ordering with no documented comparison shows weakness there. The other options describe normal documentation, reporting lines and a sound three-way matching control.

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