Audit programme. The following are 10 audit procedures taken from an audit programme: 1 Review board of
Question:
Audit programme. The following are 10 audit procedures taken from an audit programme:
1 Review board of directors’ minutes to verify approval of equipment purchases.
2 Discuss with the cash disbursements clerk his or her and duties and observe whether he or she has responsibility for handling cash or preparing the bank reconciliation.
3 Examine the accounting clerk’s initials on monthly bank reconciliations as an indication of whether they have been reviewed.
4 Review sales, cash receipts and sales returns cut-offs.
5 Examine the initials on vendors’ invoices that indicate internal verification of pricing, extending and footing by a clerk.
6 Reconcile marketable security summary schedules to general ledger.
7 Compare the balance in payroll tax expense with previous years, taking into consideration any changes in payroll tax rates.
8 Count a sample of inventory and check against inventory sheets.
9 Account for a sequence of checks in the cash disbursements journal to determine whether any have been omitted.
10 Confirm accounts payable balances in writing with a sample of vendors.
Required
A. For each of the above audit procedures, give the audit area (accounts receivable, cash, etc.)
it is from, the audit objective and financial statement assertion.
B. For each audit procedure, list the techniques for gathering evidence used (inquiry of client personnel, observation, examination of documents, calculation, confirmation, analytical procedures and inspection).
Step by Step Answer:
Principles Of Auditing: An International Perspective
ISBN: 9780077095321
1st Edition
Authors: Rick Stephan Hayes, Philip Wallage, Arnold Schilder, Roger Dassen