Which of the following is most likely to be considered a control weakness?

Which of the following is most likely to be considered a control weakness?
A . Vendor invoice payment requests are accompanied by a purchase order and receiving report.
B . Purchase orders are typed by the purchasing department using prenumbered forms
C . Buyers promptly update the official vendor listing as new supplier sources become known.
D . Department managers initiate purchase requests that must be approved by the plant superintendent

View Answer

Answer: C

Explanation:

A control weakness occurs when there is a deficiency in internal controls that could allow errors or fraud to occur. While the act of buyers promptly updating the vendor listing might seem efficient, it could bypass necessary oversight and approval processes. This could lead to unauthorized or inappropriate vendors being added, increasing the risk of fraud or favoritism. Effective internal control requires that such updates be reviewed and approved by an independent party to ensure accuracy and appropriateness.

Reference: Best practices in internal control recommend segregation of duties and independent review processes to prevent unauthorized changes and ensure control integrity.