L13 Notes_Part_8 - Accounts Receivable Audit Program Audit...

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© W.R. Knechel Analysis of Sales Transactions Valuation Validity P1 * Q1 = S1 Accounts Receivable P2 * Q2 = S2 Cust No. 1 P3 * Q3 = S3 1/2/97 S1 P4 * Q4 = S4 (fictitious) 1/5/97 S2 = 1/15/97 -S1 A/R 1 = Cust No. 2 = 1/13/97 S3 A/R 2 Pn * Qn = Sn Total Sales (SJ, G/L, AR sub. ledger) SJ date <-> BOL date Cable Co. approach ARbeg - ARend +CR = sales A/R sub. date <>SI date , estimated sales =No. of subscribers * published rate A/R: review for unusual amounts, confirm, alternative procedures, CR (-S1) documents Sum of A/R = AR Subsidiary ledger, A/R TB, A/R Aging, G/L A/R Why show sales gross? Sales - sales discounts - sales returns = net sales Pz *Qz = Sz omitted sale Story: Discuss post it note system
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© W.R. Knechel
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Unformatted text preview: Accounts Receivable Audit Program Audit Objective Audit Procedure Valuation Confirmation Review Allowance Account Change in credit policy Noncurrent experience Dun & Bradstreet Correspondence File Validity Confirmation Shipping document Subsequent cash receipts Mechanical Accuracy Aged T/B <-->foot T/B<----->G/L ^ A/R Subsidiary Ledger Completeness Analytical Review Test of Transaction on shipments Foot A/R T/B -> G/L <- A/R Aging Owned Problem: factored, sold or assigned Detection: minutes, bank conf., inquire with client, correspondence file © W.R. Knechel Customer Service: Substantive Testing Cash Cash counts (lockdown, PC) Bank confirmation Bank reconciliation Proof of cash Test of interfund transfers (Kiting) Test for Lapping...
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This note was uploaded on 10/05/2011 for the course ACG 5637 taught by Professor Monikacaushoulli during the Fall '08 term at University of Florida.

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L13 Notes_Part_8 - Accounts Receivable Audit Program Audit...

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