AUDIT OF CASH

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 Audit of Cash
Perform manual bank reconciliation to
know the correct balance of cash that
should be reported by the Company.
Reconcile the Balance per SAP records and
Balance per Bank Statement.

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 Audit of Cash
Open the General Ledger of the Cash Account in SAP
Business One to reconcile it with the Bank Statement.
Go to Financials > Financial Reports > Accounting >
General Ledger
In the General Ledger – Selection Criteria, uncheck the
Business Partner Box and check the accounts box.
Make sure that no accounts are marked with ‘x’.
Change the level of accounts to 5.
Mark ‘x’ the CA201 – Metrobank Account No. 9021
For the posting date From field, enter 01.01.13 and To
field 12.31.13 to show the transactions for the whole
fiscal year 2013 for this account.
Then press Ok.

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The deposit in the bank statement amounting
to Php 190,000.00 was traced to a deposit slip
sent by Solid Electrics on January 2014. Upon
inquiry by the client, the deposit pertains to a
partial payment made by Solid Electrics
regarding its amount due to the client.

Now the auditor can perform his bank

reconciliation by comparing the records per
bank and the records per SAP Business One.
Write below your findings and proposed
adjusting entries.

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AUDIT OF INVENTORIES

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Audit of Inventories
Ensure that inventories are stated at lower of cost or net
realizable value.

The company’s manager told the auditor that on December 20,

the compartment where the laptops are being stored caved in
resulting in some exterior damages on the units. The laptops are
still working properly however the physical appearance have
been damage and they fear that they might not sell it on their
intended prices so they decide to hire someone to compute the
net realizable values of the laptops.

This list of net realizable values were given to the auditor:

Acer Laptops PhP28,000.00
Dell Laptops PhP25,000.00
Lenovo Laptops PhP28,000.00
Samsung Laptops PhP30,000.00
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Audit of Inventories
Compare the recorded costs of the inventories with
their NRV and compute for the necessary adjustment
to recognize inventory loss.
Open the Inventory Audit Report
Go to Inventory > Inventory Reports > Inventory
Audit Report
On the Selection Criteria insert the following
information in the specified field.
~ Change to Posting Date
~ From 01.01.13, To 12.31.13 to include the
transactions for the whole fiscal year 2013.
~ Item Code: From A1000 To S1000
~ Then click OK.
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The Inventory Audit Report will appear.

If you click on the black arrow beside the yellow arrow, the details
of a particular item will expand. Now the auditor can know the
actual cost recorded per system and compare it with its net
realizable value. Take note that the valuation method used for the
laptops is First In, First Out (FIFO).

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Enter your Inventory Cost and NRV
analysis.
Laptops Cost NRV Difference

Write down your findings and proposed

adjusting entries.

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