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The shipping date is before the order date. 22. Which management assertion(s) are you concerned has...

The shipping date is before the order date. 22. Which management assertion(s) are you concerned has been violated and why?

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Answer #1

In the normal procedure the purchase order should be received first and then the shipping could be made. Therefore, the shipping date must be after the order date.

Since it is not done here, the following assertions are violated:

No.1) Transaction level: If the order is recorded as sales revenue the occurrence of such transaction can’t be proved, since the necessary shipping document is back-dated.    

No.2) Account balance: Accounts receivable balance is not accurate, since a credit sale is recorded there which doesn’t have appropriate supporting.

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