The threat of paying prices that are too high for goods ordered can pose a problem in the expenditure cycle.What is an appropriate control that would be applicable to help mitigate this threat?

Question

Quizplus · Accepted Answer

Using only approved suppliers and soliciting competitive bids helps ensure that prices paid for goods are not excessively high. This control helps to mitigate the risk of overpaying for goods. Choice A is a valid control, but it only addresses the validity of the purchase order, not the price paid for the goods. Choice C is also a valid control, but it only ensures that invoices are supported by appropriate documentation, not that the prices paid for goods are reasonable. Choice D is not a relevant control in this context.

The Threat of Paying Prices That Are Too High for Goods