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CS Professional · Internal and Forensic Audit · Internal Controls

Mehta Pharma Ltd's accounting software rejects any purchase invoice for which no approved purchase order number exists in the system. This control is best classified as:

It is a preventive, automated control. The software stops an invoice lacking an approved purchase order from being processed at all, so the unauthorised transaction is blocked before it occurs. A detective control would instead find the problem after posting, and this one needs no manual intervention.

  1. ADetective, automated control
  2. BPreventive, automated controlCorrect
  3. CCorrective, manual control
  4. DDetective, manual control

Explanation

The system blocks the invoice before it is processed, so the error or unauthorised purchase is stopped at entry, which makes it preventive. It operates through software, so it is automated. A detective control would only identify the problem after posting.

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