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Exam AUD topic 1 question 832 discussion

Actual exam question from AICPA's AUD
Question #: 832
Topic #: 1
[All AUD Questions]

Mailing disbursement checks and remittance advices should be controlled by the employee who:

  • A. Approves the vouchers for payment.
  • B. Matches the receiving reports, purchase orders, and vendor's invoices.
  • C. Maintains possession of the mechanical check-signing device.
  • D. Signs the checks last.
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Suggested Answer: D 🗳️
Choice "D" is correct. Mailing disbursement checks and remittance advices should be controlled by the employee who signs the check last. This employee is generally in the treasury department.
Choices "A" and "B" are incorrect. Approving the vouchers for payment and matching the receiving report, purchase orders, and vendor's invoices are functions of the vouchers payable department.
Choice "C" is incorrect. When a mechanical check-signing device is used, there is generally dual control. One person maintains possession of the device itself, and the other controls the signature plates. The person with possession of the device would not mail disbursement checks, since mailing should be done by the last check signer.
by gemazyni at April 5, 2025, 5:11 p.m.

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