WEEK 4: THREATS IN THE EXPENDITURE CYCLE

The three-way match internal control requires that the accountant match the data from the PO, receiving report, and supplier invoice before paying an invoice to ensure that a company received and was billed for the inventory that was ordered.   What do you think about companies transitioning from a ‘traditional’ three-way match to a two-way match (just matching the PO and the receiving report) due to the elimination of vendor invoices in evaluated receipt settlement (ERS)?    What risks are there with this type of system that can automatically generate payments to vendors? 

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