The subsequent internal controls for the acquisition and payment cycle were selected from a standard internal control questionnaire.
1. Checks are mailed by owner or manager or a person under her supervision after signing.
2. All supporting documents are cancelled after electronic funds transfers are or checks are signed approved.
3. The authorized signer compares data on supporting documents with electronic funds transfer and checks authorizations.
4. Vendors' invoices are recalculated before payment.
5. Approved purchase orders are necessary for all acquisitions of goods.
6. Prenumbered receiving reports are prepared as support for acquisitions and numerically accounted for.
7. Dates on receiving reports are compared with vendors' invoices before entry into acquisitions journal.
8. The accounts payable master file is updated, balanced, and reconciled to general ledger monthly.
9. Account classifications are reviewed by someone other than preparer.
10. All checks are signed by manager or owner.

Required
a. For each control, recognize which element of the five categories of control activities is applicable (separation of duties, proper authorization, adequate documents or records, physical control over records and assets, or independent checks on performance).
b. For each control, state which transaction-related audit objective(s) is (are) applicable.
c. For each control, prepare an audit procedure that could be used to test the control for effectiveness.
d. For every control, recognize a likely misstatement, assuming that the control does not exist or is not functioning.
e. For each likely misstatement, classify a substantive audit procedure to evaluate whether the misstatement exists.