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Identify three ways in which a duplicate payment may occur in an accounts payable system. Explain...

Identify three ways in which a duplicate payment may occur in an accounts payable system.

Explain the significance of system risks when designing a set of internal controls for a system. Give examples that relate to your answer above.

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Answer #1

Three ways in which a duplicate payment may occur in an accounts payable system

  1. The data entry errors may increase the chances for duplicate invoice payments.
  2. Payments made by outside accounts payable may cause duplicate payments
  3. Payments sent through multiple channels leads to duplicate payments

The significance of system risks when designing a set of internal controls for a system

  1. Errant Payments : Error in making the payment is the risk that may occur in designing a internal control system.
  2. Late or Missed payments : Delayed payments or missed payments also may occur in an internal control system.
  3. Errant accruals : Like payments, there is a chance that the accruals also may be delayed or missed or mistaken. This is an another risk that may occur.
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