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    Auditing Cycle

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    temedebere
    The document asserts that for the acquisition and expenditure cycle, purchases and related events that have occurred are properly recorded, all relevant purchases and events are recorded, purchases are recorded at the proper amount, and purchases are properly presented and disclosed in the financial statements. It lists related controls such as segregation of duties, prenumbered documents, review and approval processes, and reconciliation procedures. It also lists tests of controls to check that the controls are functioning as intended, such as observing segregation of duties, checking document sequences, recalculating amounts, and examining evidence of reviews.

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    Auditing Cycle

    Uploaded by

    temedebere
    72 views2 pages
    The document asserts that for the acquisition and expenditure cycle, purchases and related events that have occurred are properly recorded, all relevant purchases and events are recorded, purchases are recorded at the proper amount, and purchases are properly presented and disclosed in the financial statements. It lists related controls such as segregation of duties, prenumbered documents, review and approval processes, and reconciliation procedures. It also lists tests of controls to check that the controls are functioning as intended, such as observing segregation of duties, checking document sequences, recalculating amounts, and examining evidence of reviews.

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    Auditing cycle.docx

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    The document asserts that for the acquisition and expenditure cycle, purchases and related events that have occurred are properly recorded, all relevant purchases and events are recorded, purchases are recorded at the proper amount, and purchases are properly presented and disclosed in the financial statements. It lists related controls such as segregation of duties, prenumbered documents, review and approval processes, and reconciliation procedures. It also lists tests of controls to check that the controls are functioning as intended, such as observing segregation of duties, checking document sequences, recalculating amounts, and examining evidence of reviews.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    72 views2 pages

    Auditing Cycle

    Uploaded by

    temedebere
    The document asserts that for the acquisition and expenditure cycle, purchases and related events that have occurred are properly recorded, all relevant purchases and events are recorded, purchases are recorded at the proper amount, and purchases are properly presented and disclosed in the financial statements. It lists related controls such as segregation of duties, prenumbered documents, review and approval processes, and reconciliation procedures. It also lists tests of controls to check that the controls are functioning as intended, such as observing segregation of duties, checking document sequences, recalculating amounts, and examining evidence of reviews.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    Assertions about Classes of Transactions and Events for the Period: Acquisition and Expenditure Cycle.

    Assertion Controls Tests of Control

    Existence and occurrence- Segregation of duties between Observe segregation of duties.


    Purchases and related events that purchasing, receiving, and
    have been recorded have occurred accounting. Purchase orders Check agreements of purchases in
    and pertain to the entity. support invoices Receiving purchases detail file to invoices,
    documents exist for all invoices. supporting receiving documents
    Recorded purchases and and customer purchase orders for
    expenditures supported by customer name, product
    invoices. description, terms, dates and
    quantities.

    Examine evidence of mangers’


    reviews of actual versus budget
    Managers compare actual expense and of follow-up on unusual
    to budgeted amounts. items.

    Examine canceled checks and


    Invoices are canceled with a agree to supporting voucher.
    PAID stamp when paid. Examine paid vouchers for PAID-
    stamp.

    Completeness-All purchases and Vouchers, receiving reports, Scan documents for numerical
    related events that should have purchase orders, and checks are sequence. Observe client
    been recorded. prenumbered, and the numerical checking sequence.
    sequence is checked.
    Examine evidence of client review
    Overall comparisons of purchases of analytical purchasing data.
    are made periodically by a
    statistical or product line analysis.
    Check date of receipt to date
    Date of receiving report is recorded in voucher journal.
    compared to invoice date. Examine evidence of client
    comparison of dates.
    Trace receiving reports to
    recording in purchases detail file.

    purchased, and all related Purchase contracts are authorized


    obligations are recorded. at the appropriate level, and
    accounting is made aware of all
    significant terms.
    Rights and obligations-The
    company has all rights to items
    Inquire about procedures for responses. Read significant
    ensuring terms of large contracts purchase contracts and examine
    are properly disclosed. Verify for proper signature.

    Valuation or allocation-Purchases Invoice quantities and prices are Compare prices to approved price
    and related events have been compared to purchase orders and listing observe client comparing
    recorded at the proper amount. receiving reports. receiving quantities.

    Examine evidence of client


    Prices checked and mathematical checking. Recalculate price
    accuracy are independently extensions and discounts.
    checked before voucher prepared.

    Presentation and disclosure- Chart of accounts is used for Observe use of chart of accounts
    Purchases, accounts payable, and classifying purchase entries. and correct account classification.
    related events are recorded in the Purchases from subsidiaries and
    proper accounts. Significant affiliates are classified as
    terms are disclosed in the intercompany purchases and
    financial statements. payables. Purchases returns and
    allowance are properly classified.

    Journal entries are reviewed by Examine Evidence of journal


    appropriate level. entry review.

    Individual accounts payable are Examine reconciliation and


    reconciled to general ledger. support for reconciling items.

    Statements are reviewed and Examine evidence of financial


    approved at senior level. statement review by senior
    officials.

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