An audit procedure which compared the name, amount and dates shown on remittance advices with cash receipts journal entries and with related duplicate deposit slips would be effective in detecting:
A) illicit write- offs of customers as uncollectible accounts.
B) lapping.
C) sales without proper credit authorisation.
D) kiting.

Question

Quizplus · Accepted Answer

This procedure is effective in detecting lapping, which involves the misappropriation of cash receipts and covering up the theft by delaying the recording of payments from customers. By comparing remittance advices, cash receipts, and deposit slips, discrepancies can be identified that may indicate lapping.

An Audit Procedure Which Compared the Name, Amount and Dates