Audit and Assurance Practice Exam

Which of the following is NOT a task performed by an automated purchasing system?

1. Automatically flagging invoices that reconcile with purchase orders.

2. Creating change orders.

3. Applying preloaded specifications to initiate processes.

4. Analyzing variances from purchase orders.

The correct answer is: Automatically flagging invoices that reconcile with purchase orders.

An automated purchasing system is designed to streamline various tasks involved in procurement processes. Among the functions it typically performs are creating purchase orders, managing supplier information, and facilitating communication between the purchasing department and vendors. The task of automatically flagging invoices that reconcile with purchase orders is generally related to the accounts payable process, which reviews and approves invoices after the purchasing process has already occurred. It ensures that the goods or services received match what was ordered but isn't a primary function directly executed within the purchasing system itself. On the other hand, creating change orders, applying preloaded specifications to initiate processes, and analyzing variances from purchase orders are all tasks that emphasize the system's involvement in the procurement workflow. Creating change orders allows for adjustments to purchase orders when necessary, applying specifications ensures consistency and accuracy in the purchasing process, and analyzing variances helps in monitoring price discrepancies or delivery issues, which are key components of managing supplier relationships and procurement efficiency. In summary, automatic invoice reconciliation is more of an accounts payable function rather than a core task of an automated purchasing system, making it the option that does not align with the standard operations typically associated with such systems.