Question

Your audit objective is to determine that purchases of office supplies have been properly authorized. If purchases of office supplies are made through the purchasing department, which of the following procedures is most appropriate?

1) Vouch purchase orders to approved purchase requisitions
2) Trace approved purchase requisitions to purchase orders
3) Inspect purchase requisitions for proper approval
4) Vouch receiving reports to approved purchase orders

Answer 1

The most appropriate procedure to determine proper authorization of office supplies purchases through the purchasing department is to vouch purchase orders to approved purchase requisitions, which ensures each purchase was authorized before a commitment to buy was made. Hence, the correct answer is option 1.

Step-by-step explanation:

If your audit objective is to determine that purchases of office supplies have been properly authorized and these purchases are made through the purchasing department, the most appropriate procedure is to vouch purchase orders to approved purchase requisitions. This means you select a sample of purchase orders and go backwards through the purchasing process to verify that each purchase order is matched with, and thus justified by, an authorized purchase requisition.

Vouching helps ensure that a purchase was indeed authorized by appropriate personnel before a commitment to buy was made. By doing this, you help ensure adherence to the company's internal controls around the authorization of purchase transactions.