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|Initials |Comments |
| |Objectives | | | |
|Discuss the type, scope, and timing of the audit with the owner/manager, board | | | | |
|of directors or, if applicable, the audit committee. Also, discuss adequacy of| | | | |
|working space for the audit team, access to client records, and assistance, if | | | | |
|any, to be furnished by the client. | | | | |
| | | | | …show more content…
As you will see, the client made a posting error to cash and accordingly the bank reconciliation is incorrect. Once discovering the error, students will attempt to correct the error by altering the client’s bank reconciliation. In their attempts to correct the bank reconciliation, their explanations will only confuse the manager when they attempt to review the workpapers. Thus, it is suggested that the student just prepare their own bank reconciliation (and adjust O/S check list). This is an excellent opportunity to convey the importance of communicating through …show more content…
The real test will be for the students to document their work adequately (i.e. cross-referencing and tieing balances back to the trial balance). • The lead schedule must be adjusted like the accounts receivable schedule. • There is a problem with inventory obsolescence. This amount is subject to student estimate. We have come up with an estimate based on day sales in inventory and using last year’s %. • The student must also decide about a receipt for a shipment of shoes from Anglonesia Rehabilitation. The shoes should be treated as if received in 2007. When in doubt it is better to record a liability then to leave it unrecorded. Audit Program – Inventory and Cost of Sales (D)
|Audit Procedures |Audit |W/P Ref. |Initials |Comments |
| |Objectives | | | |
|Physical Inventory Observation | | | |
| |Objectives | | | |
|Discuss the type, scope, and timing of the audit with the owner/manager, board | | | | |
|of directors or, if applicable, the audit committee. Also, discuss adequacy of| | | | |
|working space for the audit team, access to client records, and assistance, if | | | | |
|any, to be furnished by the client. | | | | |
| | | | | …show more content…
As you will see, the client made a posting error to cash and accordingly the bank reconciliation is incorrect. Once discovering the error, students will attempt to correct the error by altering the client’s bank reconciliation. In their attempts to correct the bank reconciliation, their explanations will only confuse the manager when they attempt to review the workpapers. Thus, it is suggested that the student just prepare their own bank reconciliation (and adjust O/S check list). This is an excellent opportunity to convey the importance of communicating through …show more content…
The real test will be for the students to document their work adequately (i.e. cross-referencing and tieing balances back to the trial balance). • The lead schedule must be adjusted like the accounts receivable schedule. • There is a problem with inventory obsolescence. This amount is subject to student estimate. We have come up with an estimate based on day sales in inventory and using last year’s %. • The student must also decide about a receipt for a shipment of shoes from Anglonesia Rehabilitation. The shoes should be treated as if received in 2007. When in doubt it is better to record a liability then to leave it unrecorded. Audit Program – Inventory and Cost of Sales (D)
|Audit Procedures |Audit |W/P Ref. |Initials |Comments |
| |Objectives | | | |
|Physical Inventory Observation | | | |