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22 Cards in this Set
- Front
- Back
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Test of Controls for Cash Receipts.
CR are deposited in tact and daily. Objective: Occurence |
1. For a sample of recorded CR in the CR journal: a) Vouch to dep. in the bank stmt.
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Test of Controls for Cash Receipts.
CR are deposited in tact and daily. Objective: Accuracy |
1. For a sample of recorded CR in the CR journal: b) Recalculate the cash summarized for a daily dep. or posting.
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Test of Controls for Cash Receipts.
CR are deposited in tact and daily. Objective: Cutoff |
1. For a sample of recorded CR in the CR journal: c) Compare the date of receipt to the recording date.
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Test of Controls for Cash Receipts.
CR are deposited in tact and daily. Objective: Classification |
1. For a sample of recorded CR in the CR journal: d) Trace the receipts to the postings in the correct customer's accts.
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Test of Controls for Cash Receipts.
Deposits are reconciled w/ totals posted to the AR subsid. ledger. Objective: Completeness |
2. For a sample of daily cash dep. fr. the client's bank stmt., trace to the CR journal.
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Tests of Controls over Cash Disbursements.
Test: a) For a sample of recorded cash disbursements from the CDJ, vouch to supporting documentation for evidence of mathematical accuracy, correct classification, proper approval and proper date of entry. IC: Checks are not printed until voucher packets are prepared. |
Occurrence and Cutoff
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Tests of Controls over Cash Disbursements.
Test: a) For a sample of recorded cash disbursements from the CDJ, vouch to supporting documentation for evidence of mathematical accuracy, correct classification, proper approval and proper date of entry. IC: An employee compares amounts on printed checks w/ voucher packets prior to submission for signature. |
Accuracy
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Tests of Controls over Cash Disbursements.
Test: a) For a sample of recorded cash disbursements from the CDJ, vouch to supporting documentation for evidence of mathematical accuracy, correct classification, proper approval and proper date of entry. IC: Only authorized signers are permitted to sign checks. |
Occurrence
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Tests of Controls over Cash Disbursements.
Test: b) Scan checks for sequence. Look for gaps in sequence of duplicate numbers. IC: Checks are prenumbered and accounted for. |
Completeness
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Tests of Controls over Cash Disbursements.
Test: c) Review bank reconciliations to ensure that they were prepared on a timely basis. IC: Bank Reconcil. are prepared on a timely basis. |
Cutoff
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Assertions and Substantive Proceed. in the Revenue & Collection Cycle:
SP: Confirm a sample of AR and perform follow-up procedures. |
Existence: AR exists.
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Assertions and Substantive Proceed. in the Revenue & Collection Cycle:
SP: Inquire whether any receivables have been sold or factored. Rev. bank confirmations, loan agreements, and minutes of the board for indications of pledged, discounted or assigned receivables. |
Rights and obligations: the entity holds or controls the rights to AR.
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Assertions and Substantive Proceed. in the Revenue & Collection Cycle:
SP: Perform sales cutoff tests. Include a sample of zero-balance accts. in the confirmation process. |
Completeness: All receivables that should have been recorded are recorded.
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Assertions and Substantive Proceed. in the Revenue & Collection Cycle:
SP: Obtain an aged TB of individ. cust. accts. and test the aging. Compare CY w/o experience to the PY allow. for bad debts. Examine CR after the BS date for collections on past-due accts. For large past-due acctss., obtain financial stmt. or credit rpts. and discuss w/ the credit mgr. Calc. an allow. est. using prior relations of w/o and sales, taking under consideration current economic events. |
Valuation or allocation: Receivables are included in the financial statements at appropriate amounts and any resulting valuation adj. are properly recorded.
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Assertions about Acquisitions and Expenditure Cycle:
SP: Vouch recorded payables to vendor invoices, receiving rpts, and POs. Confirm high-risk AP w/ vendors. |
Existence: AP exist.
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Assertions about Acquisitions and Expenditure Cycle:
SP: Review bank confirmations, loan agreements, and minutes of the board for indications that property has been pledged as collateral. |
Rights and oblications: The company has all rights to items purchased. Liabiliites are obligations of the entity.
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Assertions about Acquisitions and Expenditure Cycle:
SP: Perform search for unrecorded liabilities. |
Completeness: All payables that should have been recorded are recorded.
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Assertions about Acquisitions and Expenditure Cycle:
SP: Test mathematical accuracy of payables listing. Select accounts due and test arithmetical accuracy and terms on invoices. |
Valuation or allocation: Purchases and related transactions have been recorded at the proper amount.
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Assertions about the Production Cycle:
SP: Observe client's physical inv. count. Confirm inv. held by others on consignment. Vouch items on inv. listing to inv. count tags. Analytical procedures: Compare inv. turnover and gross margin to budget and previous periods and discuss differences w/ client personnel. |
Existence: Inventory exists
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Assertions about the Production Cycle:
SP: Inquire whether any inv. is on consignment. Inquire whether inv. has been pledged as collateral or security. |
Rights and obligations: The entity holds or controls the rights to inventory.
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Assertions about the Production Cycle:
SP: Rev. inv. subsidiary accts. and trace to inv. control acct. Rev. physical inv. to ensure all items were counted. Trace test inv. counts to inv. subsidiary accts. and control acct. |
Completeness: All inv. that should have been recorded has been recorded.
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Assertions about the Production Cycle:
SP: Perform lower-of-cost-or-market tests. Rev. CGS calculations. Check that inv. cost agrees w/ standard costs or purchase invoices. Inquire whether any inv. is obsolete or unsalable. Examine loans and other agreements for the use of inv. as collateral. |
Valuation and allocation: Inventory is included in the financial statements at appropriate amounts and any resulting valuation adj. are properly recorded.
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