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CMA Intermediate · Corporate Accounting and Auditing · Audit Sampling, Audit Techniques and Analytical Procedure

Using audit software, an auditor extracts from the purchase ledger of Kaveri Traders Ltd all payments to vendors where the same invoice number and amount appear more than once. This CAAT procedure is mainly designed to detect:

The procedure mainly detects duplicate payments. Software scans the payment file for repeated invoice numbers and amounts, which is a typical data-matching CAAT applied to the purchase ledger. It does not directly test inventory, sales completeness or depreciation rates.

  1. AUnderstatement of closing inventory
  2. BDuplicate paymentsCorrect
  3. CUnrecorded sales
  4. DIncorrect depreciation rates

Explanation

Matching on invoice number and amount across the payments file identifies the same invoice paid twice. It examines payments, so it does not address unrecorded sales or inventory valuation. Depreciation rates would need a different test on the asset register.

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