Professional Documents
Culture Documents
Substantive Tests
Substantive Tests
Substantive Tests
Sales Transactions
F. Measurement
Sales are correctly billed Sales and accounts For sample of entries in the
and recorded. receivable may be sales journal, (a) examine
misvalued sales invoice shipping
document, and customer
order for consistency of
descriptions and quantities;
(b) examine sales orders for
credit approval; and (c)
check prices and extensions
Foot sales journal and
general ledger account.
G. Presentation and
disclosure
Assertions
A. Existence/ B. Occurrence
Sales and accounts receivable are for 1. Confirm accounts receivable and
shipments made to customers. perform alternative procedures
for confirmations not returned.
2. Perform analytical procedures to
test sales and accounts receivable.
C. Completeness
Accounts receivable are owned by the client. 4. Review minutes of the board of
directors' meetings, inquire of
client personnel read contracts
and agreements, and confirm with
lenders any indications that
accounts have been assigned,
sold, or pledged.
Sales and accounts receivable are properly 7. Review the financial statements
presented and disclosed in accordance with and perform analytical procedures
PFRS to determine whether accounts
are classified and disclosed in
accordance with PFRS
C. Analytical Procedures
Misstatements
Analytical Procedures
Overstatement or
understatement of sales
data
Overstatement or
and allowances
Overstatement or
uncollectible accounts
previous allowance.
5.
6.
7.
8.
accounts receivable
'
9.
A.
Potential
Misstatements
Substantive Audit
Procedures
Assertions
A. Existence/
B. Occurrence
collections of cash
from customers
sample of entries
C. Completeness /
D. Rights and
obligations
recorded
Cash may be
misappropriated.