Test of transactions: auditing accounts receivable
Suppose you selected a sample of customers' accounts receivable and wanted to find supporting evidence for the entries in the accounts. Where would you go to vouch the debit entries? What would you expect to find? Where would you go to vouch the credit entries? What would you expect to find?
Solution Preview
To vouch debit entries, one would test the billings (or invoices) for the following attributes:
1. the invoices exist
2. they belong to the client
3. they are complete
4. they are properly valued
You begin by tracing recorded sales back to customer invoices and then to customer ...
Solution Summary
The solution provides attribute objectives for the test of transactions of accounts receivable. It explains how you track through a system for both charges and credits to customer accounts.
... e) For each test of control, state the internal ... The internal control that is being tested is that ... control system ensures that sales transactions are properly ...
... aged trial balance should be tested for evidence ... 2. Substantive test of transactions Extensive Confirmation letters for testing account receivable...
... that all nonresponses pertain to year-end transactions, and (b) when testing for overstatement ... of accounts receivable and other substantive tests of details ...
... programs and files from outside sources tested for viruses ... of control following processes or tests of controls ... Perform the test of computer application controls ...
... B) to test cut-off ... material transactions will be selected for substantive testing b. Substantive ... objectives d. Each account balance will be tested under either ...
...tests are to test if the transactions belong to ... The focus of substantive tests in the finance and ... The test of reasonableness would have alerted the auditor to ...
... on the prior year workpapers and only test the current ... Compared to PP&E where few transactions are the norm ... would take about the same amount of audit time as ...
... For testing of controls samples of transactions have to be tested and supporting documents ...Test of Controls Results - Revenue December 31, 2015. ...
... Potential Audit Tests. ... Another test would be to test purchases and see if each purchase was ... you would check for occurrence by selecting and testing invoices for ...
