Discuss the substantive audit procedures that you would perfeom on the allowance for the credit losses figure at year end

you are the auditor of Cape-Dairy (Pty) Limited (Cape-Dairy), a company producing organic milk at their facility in Durbanville. The company has a December financial year end. The only audit work performed on the allowance for credit losses balance at year end was an analytical review procedure: Extract from the analytical review procedure performed by the auditors Expectation: We expect the allowance for credit losses to increase in line with the industry average of 11%. Accepted deviation: Up to 2% either side of the expectation; that is, 9% or 13%. Actual allowance calculated by management: R10,000,000 (gross receivables) x 7.5%=R750,000. Action: Follow up with management and corroborate explanations through the performance of substantive audit procedures