CHECKLIST FOR AUDIT OF COOPERATIVES

S.N Particulars Complied? Remarks

Check whether opening (beginning) trail balance as per audited
1.
report or not.
Share capital
• Check whether paid-up capital exceeds Authorized capital.
2.
• Whether authorized capital increased or not.
• Whether non-individual are shareholders (members) of
cooperatives.

Deposit
3. • Check whether Deposit Exceeds 10 times of Paid-up
capital or not.

Investments (Shares or Fixed deposit)

• Verify new investment from share certificates.
• Check whether approval is obtained for investment by the
4.
Board of Directors.
• Verify all-share certificates has been issued.
• Verify the certificates where it was safekeep.

Loan file review

• Loan Application form (details of family and others
information)
5. • Loan Agreement, promissory note is properly filled-out,
along with witnesses and notarized documents.
• Oldest loan original form still exists.
• Mortgage properties are annotated.

Fixed Assets
• Verify addition of fixed assets as per invoice.
• Check whether approval has been taken from Board, as
per Board of Resolutions.
• Check and examine the date of purchase and whether
depreciation is charged as below or not?
6. • Check the PPE lapsing schedule
• Check if the properties were properly tags
• Check if they conduct inventory count of PPE
• Secure list of Inventory Committee
• Verify whether Property Acknowledgment Receipt (PAR) was
issued to accountable officer.
• Check whether assets were fully insured or not.

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CHECKLIST FOR AUDIT OF COOPERATIVES

• Check whether GL reconciled with SL

7. Stock of Cheque books and stationery maintained?

Cash Balance
8. • Conduct cash count
• Verify balance of Books as per cash ledger.

Bank Balance
• Verify bank balance as per Book with balance per Bank
9. statement.
• Check Bank Reconciliation statement if any in case of
different balances as per books.

Advances, deposits and other receivables

• Verify amount paid for different type of deposits made
like Telephone deposits with payment slip or receipt from
where deposit is made.
• Check and verify the advance amount paid for (Like;
10. acquisition of different assets, paid to suppliers etc)
• Calculate prepaid amount in case of Insurance expenses,
Newspaper subscriptions or other annual expenses paid
once.
• Verify other receivables amount from any party.
• Obtained records of unliquidated cash advances

Account Payables & Provisions

- Verify bill or agreement for any amount payables.
11.
- Verify calculation of TDS payables or income tax provisions,
whether as per specified rate as per Income Tax Act 2058.

Loan Loss Provision (LLP)

• Verify whether a sufficient provision has been made
for Loan loss as per Cooperative Act.
12.
▪ 1% - For performing Loan.
▪ 35% - Loan overdue not more than 1 year.
▪ 100% - Loan overdue for more than 1 year.

13. Interest Income

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CHECKLIST FOR AUDIT OF COOPERATIVES

- Verify bank interest income booked from interest certificate

issued by bank.

Dividend income
14. • Verify dividend income as per statement or payment
advice given by financial institution.

Other Income
15. • Verify other income from agreement paper (in case of
Building Rent) or receipts in any other cases.
Human Resource Expenses
• Verify salary and allowance expenses from salary sheet
16. and voucher.
• Verify whether the Cooperative established a retirement
benefit plan
Administrative Expenses
• Verify Admin expenses as follows
• Donation expenses to tax free enterprises or not? House
rent booked as per Rent agreement or not.
17. • Board members allowances has been approved by General
Assembly or not.
• Whether prepaid amount was separated from Insurance
expenses or not?
• Check expenses with invoice of the policy.
Repair & Maintenance Expenses
• Verify whether the RM expenses exceed 7% of
18. Depreciable Value of the assets in the block.
• Verify whether expense which is to be capitalized is
charged as repair and maintenance expenses or not .
Documentation/Observations - ongoing Procedures
• Internal control and procedures
• Verification of Assets (specially addition part, proper Bill
19. or not)
• Operational part (Payment & Withdrawal mechanism)
• System Review (Preparation of Vouchers and approving
Mechanism)
Physical Cash verification done or not
• Verify Daily cash position/collection prepared & approved
20. or not.
• Verify whether surprise cash count are being conducted.
• Obtained copy of accountable officer and their fidelity bond
•

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CHECKLIST FOR AUDIT OF COOPERATIVES

21. Minute Book of the Board of Directors and General Manage

minutes (whether major transaction put on meeting or not )
Tax Compliance
• Check whether Tax deduction was done proper or not in
case of all expenses?
• Check whether Tax were deducted on Honorarium of
Board of Directors
22. • Check whether Cooperative File their withholding of
compensation.
• Check whether withholding taxes were deducted on
purchase of agricultural products on its members if the
amount purchases exceed P300,000.00.
Distribution of Fund.
• Check distribution of Reserve fund into different funds.
• Check whether mandatory distribution of net savings is
23. observed.
• Check whether there is change in percentage of
distribution as compared to last year and verify with
approval from Board of Director if any.
Savings/Time Deposit – Whether a non-member of the
24. cooperative has an existing deposit, if yes check whether a
withholding tax has been deducted and remitted to BIR
Check penal interest income details, whether penal interest
25. charged on installment due or interest due only. Whether
calculation is correct or not.
Inventory Verification
• Check inventory records as per General Ledger (GL), Subsidiary
Ledger (SL) and Trial Balance
26. • Check whether the Inventory Committed conducted an
inventory count.
• Determined inventory computation
• Inventory Custodian are bonded
Check whether Assets were fully insured or not. (Cash counter &
27.
Vault , cash in transit, vehicles or other assets )

28. Verify action taken on Overdue loan and details of it.

Single obligator limit (>10% of Total capital fund) whether

29.
crossed or not?

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CHECKLIST FOR AUDIT OF COOPERATIVES

Checked whether Loan has been sanction to person before

settlement of previous loan or ,
30.
Loan was sanctioned to same person in special conditions after
taking approval from Management committee.

Check whether loan has been sanction to greater than 49%

31.
members of Management or Audit Committee.

32. Cash collection sheet, singed by collector or not.

33. Liquidity > 15% of Total deposit or not?

Daily Disbursement
• All Disbursement are marks paid, signed, and dated.
• Withholding taxes were properly withheld in paying its
34.
suppliers/contractors.
• Supporting documents are completely attached on the
disbursement voucher

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