MS.

SEBALLE
CONTROLS ASSERTION POTENTIAL MISSTATEMENT AUDIT PROCEDURES
a. Inventory clerk to Accuracy Inaccuracies in reporting of Test check mathematical accuracy of
oversee inventories, sales and purchases entries on inventory ledgers
warehousing
function
Valuation Understatement or overstatements
Existence in inventories, sales, and purchases
Accountability since no supervisory oversight
function on the inventory clerk
b. Drivers Accuracy Inaccuracies in drivers’ reported Conduct periodic physical count of
periodically filling inventory balances inventories in the warehouse and
the vending Re: sold and replacements selected vending machines
machines with
goods
c. Deposit cash Possible theft/fraud once cash Compare data on:
collection at a collected from each vending In Purchases and sales invoice
designated bank machine since the driver is alone in Vs. delivery receipts
doing such task Vs. inventory cards
Vs. Receiving receipts

In sales/ outgoing goods

Insurance receipts vs inventory report of
(di ko maintindihan nakasulat)

Compare cash values of items sold vs

amount deposited

Determine whether cash collected during

the day are being deposited immediately
in the bank during the day of collection or
within reasonable time.

d. Drivers required Test check movements of inventories in

 to report to the
warehouse daily
CONTROLS
Inventory clerk oversees Existence/Occurrence
warehouse function
Truck drivers fill the
vending machines
Truck drivers deposit cash Existence/Occurrence
collections
Drivers are required to
report daily to the
warehouse.
GROUP 2
ASSERTION POTENTIAL MISSTATEMENT
Fictitious receipts or issues may be
recorded
Completeness Misappropriation of Asset. Goods
may be received but not recorded.
Valuation Inaccurate reporting of inventories,
Accuracy sales, and purchases.
Existence Misappropriation of Asset. Goods
Completeness may be accounted for transfers but
(not sure) not placed in the vending machines.
Accuracy Inaccurate reporting of inventory
balances; thereby affecting
recorded sales
Misappropriation of Asset. High
possibility of occurrence of theft or
fraud. Cash collected may not be
deposited.
Accuracy Inaccuracy in the reports to be
made.
the vending machine from filling out/
replacements to being sold
AUDIT PROCEDURES
Since there are no other personnel to
exercise the control activity of
segregation of duties, examine the
approval signature on receiving report
and on the issuance of goods.
Examine the Inventory record with the
supplier’s invoice.
Recalculation.
Perform periodic physical count of
inventories in the warehouse and
selected vending machines
Bank Reconciliation.
Trace the amount deposited from the
recorded sales.
Trace or vouch with source documents.