Main area of focus for audit of “Cash and cash equivalents”: Types of bank account and facilities provided by bank. Internal control procedures for the receipt of cash help your small business prevent loss due to employee fraud and accounting errors. A sales audit is a three-part process, focusing on the staff, the company’s target market and the sales plan. Audit Program for Cash/Bank. Bank reconciliation to identify any adjusting entries. These objectives are A) valuation, allocation. Cash Collections Performance Audit dated January 2015. Check petty cash book if maintained. Example: On 10.4.16, XY Co. sold goods worth Rs.60,000 for cash. Particular attention should be given to first and last month of accounting year. Vouching of Cash Receipts (Debit Side of Cash Book) We will discuss the cash receipt which are placed on the debit side of cash book for following items − Opening Balance of Cash Book. Audit of Accounts Receivables and Sales. Audit Manual. Per the U.S. Chamber of Commerce, about 75% of employees are stealing from their employer. 1. All sales are cash sales. Review cash receipts. Vouching of Cash Receipts. How to audit master data in order-to-cash processes 3. Cash exists and is owned by the client b. Check cash payment voucher with relevant support bills. Receivables-included not only claim against customers arising from the sale of goods or services, but also a variety of miscellaneous claims such as loans to officers or employee, loans to subsidiaries, claims against various other firms, claims for tax refunds, and advances given to suppliers If cash discount has been allowed on sales, he should see that a uniform policy and rate of discount has been followed. (e.g., cash receipts, sales) between the confirmation date and the balance-sheet date, and perform the following: a. These controls are intended to limit access to cash to specified employees and verify that all receipts, refunds or transfers are documented correctly and in a timely manner. Cash balances reflect a proper cutoff of receipts and disbursements c. Cash balances as presented in the balance sheet properly reflect all cash and cash items on hand, in transit, or on deposit with third parties d. Skimming by understating sales: the customer pays full price, and then the fraudster enters a discounted sale in the accounting records. When you test cash disbursements during an audit, your first job is to figure out how your audit client pays its invoices. Documents to be Vouched: Sales Invoice, Duplicate cash Memo, Summary of daily cash sales, Rough cash book and main cash book. 2. Interviewed District staff responsible for the cash receipts process. ©2012 Prentice Hall Business Publishing, Auditing 14/e, Arens/Elder/Beasley 14 - 37 Types of Audit Tests for the Sales and Collection Cycle Sales Accounts Receivable Cash in Bank Sales transactions Cash receipts transactions Ending balance Ending balance TOC + STOT + AP + TDB = Sufficient appropriate evidence Audited by TOC, STOT, and AP The cash sales register should be fully checked with the carbon copies of the cash sales bill. Business Tax and Fee Division. 1 You were able to gather the following from the December 31, 2005 trial balance of Peso Corporation in connection with your audit of the company: Cash on hand 372,000 Petty cash fund 10,000 BPI current account 950,000 Security Bank current account No. A thorough sales process audit reviews the cohesiveness of the sales team to ensure that the team has trust, shared accountability and mutual commitment to results. 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