REVIEW QUESTIONS
1. What document initiates the sales process?
2. Distinguish between a packing slip, a shipping
notice, and a bill of lading.
3. What are three input controls?
4. What are the three rules that ensure that no single
employee or department processes a transaction
in its entirety?
5. What is automation, and why is it used?
6. What is the objective of reengineering?
7. Distinguish between an edit run, sort run, and
update run.
8. How is the record’s primary key critical in preserv-
ing the audit trail?
9. What are the advantages of real-time processing?
10. Why does billing receive a copy of the sales order
when the order is approved but does not bill until
the goods are shipped?
11. How do tests of controls relate to substantive
tests?
12. In a manual system, after which event in the sales
process should the customer be billed?
13. What is a bill of lading?
14. What document initiates the billing process?
15. Where in the cash receipts process does supervi-
sion play an important role?
16. List the revenue cycle audit objectives derived
from the “existence or occurrence” management
assertion.
17. List the revenue cycle audit objectives derived
from the “completeness” management assertion.
18. List the revenue cycle audit objectives derived
from the “accuracy” management assertion.