ACCO 360 Quiz 2 Exercices - This is a practice
material for acco 360 students. This is from ACCO
360 tutorials Concordia University)
Quiz 2 Review – ACCO360
QUESTION 1
For each situation, which assertion is being tested?
1. Sales invoices are matched with shipping documents by the computer system and an
exception report is generated
• You are making sure two piece of supporting documentation match.
• Be careful: we are not looking at record to see if they match the supporting
documentations, but we are looking at two pieces of supporting documentations.
▪ They are verifying that each invoice has a matching shipping document
▪ What does this accomplish? We are making sure that all the sales
invoices are real.
▪ If we’ve actually shipped the items in the invoice, it means the invoice is
real.
▪ This control ensures that what you bill the customer for actual real things
▪ The assertion tested is occurrence
2. Receiving reports are prenumbered and accounted for on a daily basis.
• In general, anything prenumbered (whether its checks, payments, receiving reports,
etc.) is to make sure nothing is missing.
▪ Ex: you have shipping documents numbered 1,2,3,4,5,6 and you have a grand
, total of documents of 6. Nothing is missing.
▪ And what if you have shipping documents numbered 1,2,5,6. This means
something is missing.
▪ The assertion tested is completeness
3. Sales invoices are independently verified before being sent to customers.
• Let’s assume “verify” means that the sales invoices are reviewed to verify the math
▪ The assertion tested is accuracy
4. Payments by cheque are received in the mail by the receptionist, who lists the cheques and
restrictively endorses them.
• By making a list of those checks, you make sure no checks will be missing
▪ The assertion tested is completeness
5. Labour hours for payroll are reviewed for reasonableness by the computer system.
• Computer system looks at the number of hours inputted in the payroll system
• The computer system may then look to see if it makes sense that employee X worked
40h
, • If it doesn’t make sense, it will be flagged by the computer system.
• You want to make sure you are paying employees for hours they’ve actually worked
• May also verify if the employee made an error in his time sheet: the program is
making sure the number of hours are consistent (math)
• Assertion of occurrence
• Assertion of accuracy
6. Cheques are signed by the company president, who compares the cheques with the
underlying supporting documents.
• When the company president compares the checks to the supplier invoice, the
president is making sure payments are made for transactions that truly occurred
• May also verify that the math on the invoice is correct
▪ Assertion of occurrence
▪ Assertion of accuracy
7. Unmatched shipping documents are accounted for on a daily basis.
• Let’s say they are taking shipping documents and comparing those to the records
• In some situation, you have shipping documents who do not have a matching entry in
the records
• But if you shipped something, you should have revenues
▪ Assertion of completeness
8. The computer system verifies that all payroll payments have a valid employee
identification number assigned by the human resources department at the time of hiring.
• Makes sure that who you are paying are real people working for our company
▪ Assertion of occurrence
9. The accounts receivable master file is reconciled to the general ledger on a monthly basis.
• We are looking at two pieces of accounting in the books (A/R master file and the
GL).
• Compare posting in two different places in the system.
• What you have in the master file should be the same as the GL
▪ Assertion of accuracy
QUESTION 2
For each account, what control should be put in place?
material for acco 360 students. This is from ACCO
360 tutorials Concordia University)
Quiz 2 Review – ACCO360
QUESTION 1
For each situation, which assertion is being tested?
1. Sales invoices are matched with shipping documents by the computer system and an
exception report is generated
• You are making sure two piece of supporting documentation match.
• Be careful: we are not looking at record to see if they match the supporting
documentations, but we are looking at two pieces of supporting documentations.
▪ They are verifying that each invoice has a matching shipping document
▪ What does this accomplish? We are making sure that all the sales
invoices are real.
▪ If we’ve actually shipped the items in the invoice, it means the invoice is
real.
▪ This control ensures that what you bill the customer for actual real things
▪ The assertion tested is occurrence
2. Receiving reports are prenumbered and accounted for on a daily basis.
• In general, anything prenumbered (whether its checks, payments, receiving reports,
etc.) is to make sure nothing is missing.
▪ Ex: you have shipping documents numbered 1,2,3,4,5,6 and you have a grand
, total of documents of 6. Nothing is missing.
▪ And what if you have shipping documents numbered 1,2,5,6. This means
something is missing.
▪ The assertion tested is completeness
3. Sales invoices are independently verified before being sent to customers.
• Let’s assume “verify” means that the sales invoices are reviewed to verify the math
▪ The assertion tested is accuracy
4. Payments by cheque are received in the mail by the receptionist, who lists the cheques and
restrictively endorses them.
• By making a list of those checks, you make sure no checks will be missing
▪ The assertion tested is completeness
5. Labour hours for payroll are reviewed for reasonableness by the computer system.
• Computer system looks at the number of hours inputted in the payroll system
• The computer system may then look to see if it makes sense that employee X worked
40h
, • If it doesn’t make sense, it will be flagged by the computer system.
• You want to make sure you are paying employees for hours they’ve actually worked
• May also verify if the employee made an error in his time sheet: the program is
making sure the number of hours are consistent (math)
• Assertion of occurrence
• Assertion of accuracy
6. Cheques are signed by the company president, who compares the cheques with the
underlying supporting documents.
• When the company president compares the checks to the supplier invoice, the
president is making sure payments are made for transactions that truly occurred
• May also verify that the math on the invoice is correct
▪ Assertion of occurrence
▪ Assertion of accuracy
7. Unmatched shipping documents are accounted for on a daily basis.
• Let’s say they are taking shipping documents and comparing those to the records
• In some situation, you have shipping documents who do not have a matching entry in
the records
• But if you shipped something, you should have revenues
▪ Assertion of completeness
8. The computer system verifies that all payroll payments have a valid employee
identification number assigned by the human resources department at the time of hiring.
• Makes sure that who you are paying are real people working for our company
▪ Assertion of occurrence
9. The accounts receivable master file is reconciled to the general ledger on a monthly basis.
• We are looking at two pieces of accounting in the books (A/R master file and the
GL).
• Compare posting in two different places in the system.
• What you have in the master file should be the same as the GL
▪ Assertion of accuracy
QUESTION 2
For each account, what control should be put in place?
