ACC30010: Planning an Audit of Accounts Payable with Data Visualisations: You are a graduate accountant with Yorkshire & Stafford, a small auditing firm located in Balwyn: Auditing: Assignment, SUT, Malaysia

Background Information

You are a graduate accountant with Yorkshire & Stafford, a small auditing firm located in Balwyn, an eastern suburb of Melbourne, Victoria. You have been assigned to the audit of a new client, Maya Mart, for the year ended 30th June 2023. Maya Mart is a Surrey Hills-based wholesaler offering for sale everything from baby food and beverages, to snacks and vegetables, and everything in between.

You are planning the audit of accounts payable, where preparatory work has revealed the following:

•  Maya Mart purchases its stock from a list of approved suppliers, with purchase orders processed electronically through a business-to-business ecommerce system. This system uses a fast chain model of supply, with suppliers electronically transmitting their invoices as soon as they receive a purchase order from Maya Mart. The ordered goods usually arrive within a week or two of placing the order. Once received, a goods received note is raised and matched with the supplier’s invoice, and the payment authorized. You are concerned about the impact weaknesses in this process might have on the existence assertion.
• A key control to safeguard the accuracy, valuation and allocation assertion, is the use of key entry validation – an IT control whereby the Number of Units Purchased is multiplied by the Unit Cost, and compared with the Total Cost as per the supplier’s invoice.
• As is always the case with accounts payable and purchases, you are have flagged the need to investigate the risk associated with the completeness assertion.