Scenario: Ricky Wame is the audit senior on the audit of Nicholls Ltd, A sportswear company. The following is an excerpt from an interview between Ricky and the sales ledger clerk, Adam McGrath. Ric E .s.- as. a as E Ric E: 5 What are the controls over the cash recei-ts our com an receives? Good. The receptionist opens the mail each day and makes sure each cheque is crossed. He then 'ves me all the Chen ues to nost a_ainst the sales led_er. W'hat ha- - ens then? I make a list of all the cheques received for control purposes. Then I record each cheque against each customer's record on the sales ledger. After the cheques have accumulated for a couple of days, I give them to the receptionist to bank. The receptionist keeps all banking slips as a record in case there are any queries later Are there ever an differences between the Chen ue value and the associated invoice? Somemes there are. Usually it relates to a special discount that has been authorised by me or the sales manager. If the differences are not material, I will normally raise a credit note to write off the difference. What about reconciliations? Of course! The cheque listings that l have prepared are reconciled to the cash recorded in the sales subsidi. led_er; this is then reviewed b the financial controller. The main reconciliations of the