Perspective accounts receivable audit steps circularization step receivable

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					Perspective accounts receivable audit steps circularization step receivable

 receivables audit steps

  step in a strict control External Confirmation Process
  In order to strengthen the audit independence, to ensure the reliability of
circularization, should be to ensure that the letter of inquiry of the name, address,
amount and account information consistent with circularization; External
Confirmation sent before the data should be properly kept; Asked Permit required the
letter, sent directly to the audit team, if the evidence were asked to fax or e-mail write
back: In addition to the direct reception outside auditors, who also asked to be
returned to the letter of inquiry asked original certificate; letter of inquiry sent To
apply in person by the auditor; the result returned undelivered letters, to conduct
analysis, research, treatment, identification of those addresses is caused by the
External Confirmation migration, error Erzhi letters can not be delivered, or the sum
of accounts receivable have been is a false account.
  Step 2, determine the External Confirmation reasonable scope and object
  auditors should consider the cost-effective, the scope and object of the External
Confirmation should be based on professional judgments to make a choice. External
Confirmation should be considered in determining the scope of the factors include: (1)
accounts receivable in the importance of all assets; (2) Audited strength of internal
controls; (3) the results of the period prior to circularization.
  Step 3, select appropriate circularization time
  In order to fully play the role of External Confirmation should be appropriate to
select the External Confirmation of delivery time. Auditors are usually the balance
sheet date for the deadline, give full consideration to the other party replied to time,
within an appropriate time after the implementation of External Confirmation, as far
as possible be registered accountant in the audit to obtain Han Zheng before the end
of all the information. If the inherent risk and control risk assessment for the low, the
auditor can choose the appropriate balance sheet before the deadline date for
implementation of External Confirmation, and the External Confirmation items from
the balance sheet until the deadline date of the implementation of the changes
occurred substantive testing procedures.
  step 4, select the External Confirmation scientific method
  Way of circularization circularize and Affirmative Negative External Confirmation
of two. Appreciative External Confirmation, also known as positive-type,
positive-type External Confirmation is sent to the debtor Letter of Inquiry, asking him
to confirm whether the arrears by the External Confirmation correct, whether right or
wrong require replies. In general, the related internal control is invalid, the inherent
risk and control risk assessment level; expected error rate is high; large amount of
arrears of individual accounts; reason to believe that there is a dispute in arrears,
errors, etc. should be chosen positive Type circularization method. Negative External
Confirmation, also known as negative-type, negative-type External Confirmation. It is
also the letter of inquiry sent to the debtor, but the External Confirmation do not write
back when the money line, only the money in the External Confirmation when the
debtor does not match replies to the auditors.
 Step 5, to circularize the results of
 difference between the letter of inquiry received any difference, the auditor should
be analyzed to find the reason for the difference, and should contact the debtor
directly for further verification, necessary, make appropriate adjustments required
Audited. Causes of the differences may be due to both purchase and sale are stated at
the time of registration different from, or a party billing error, or fraud, fraud. Who
account for different time differences arise mainly as follows: First, the letter of
inquiry issued, the debtor has been paid, but payment has not yet received the audited
unit; second letter of inquiry is issued, the goods have been audited have been issued
and sales records, but the goods were still on the way, the debtor has not received the
goods; Third, the debtor returned the goods for some reason, but not yet received the
audited units; Fourth, the debtor received the goods on the number of , quality and
price all or part of objection to non-payment of loans.
 six-step, rigorous alternative audit procedures
 program can not be confirmed when the External Confirmation status of accounts
receivable information, you can use an alternative test procedure: (1) inspection
contract. The delivery time of contract or transaction based on the time established to
verify accounts receivable billing time, amount and other content. If you have a
contract but not performed by the sales staff to make reasonable explanation; on the
contract but no record of accounts receivable, should examine the buyer information
materials, to understand the reasons for not sign a contract. (2) access to shipping
documents. Bill of lading is a kind of each other to prove the goods have been
received; buyer bill of lading contract to the seller shipped the finished product, then
sell the establishment. Inspectors can verify bills of lading as an important basis for
the reliability of accounts receivable. (3) access to invoices. Sales invoices to prove
the importance of the establishment of evidence, only sales transaction is completed,
only an invoice. Search invoices can also be an indirect cause of the accounts
receivable that will help determine the authenticity of accounts receivable. (4) access
to the same period in bank deposit account, pay attention to whether the accounts are
not settled the issue and transfer of bank statements recorded revenue over the same
period, but the company has the blame for the problem of accounts receivable.
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