Certified Internal Auditor (CIA) Part 2: Practice of Internal Auditing — Question 263

An internal auditor reviews vendor invoices for accuracy. The auditor identifies an instance where a vendor was overpaid. The accounts payable manager explained that a debit note was later issued against the vendor and the overpayment was recovered. The auditor confirmed the amount recovered was accurate. Which of the following techniques did the auditor use?

Answer options

• A. Observation.
• B. Inspection.
• C. Vouching.
• D. Tracing.

Correct answer: C

Explanation

The auditor used vouching to confirm that the overpayment was rectified by verifying the debit note and the amount recovered. Observation and inspection do not involve validating specific transactions, while tracing focuses on following the flow of data rather than confirming specific financial transactions.