Audit procedures for Creditor & debtor

Trade creditor ( S O C C E R L I E )

1. S ystem of book keeping, recording & Internal control over purchases & liabiliy review critically.
2. O mission test
~ review after balance sheet date payment voucher & creditor invoice to ensure all liabilities appropriately taken up in the correct accounting period.
3. C ircularise independent confirmation from creditor
4. C ut off test
~ Purchases at year end
~ goods received year end
>> to ensure all liabilities have been properly account for
5. E vidence of effective operation & client system & procedure
~ to carried out compliance test
6. R encocile creditor statement
~ note any omission & impact on files
7. L ong outstanding creditor account
~ investigate reason for non settlement
8. I nvoices/ DO after relevant supporting document
~ Vouch to select
9. E nd of year balances
~ Check to creditor ledger & general ledger to ensure correct extraction

## test of control = test of compliance test
## analytical review / substantive test = test of transaction & balance(complete, accurate & valuation)

Trade debtor - beside circularisation ( BP BAD ACC )

1. B ad debt written off
~ authorised
~ review adequately by officer to control recoveries
2. P rovison (specific or general)
~ determine the policy whether is reasonable & consistent apply
3. B udget & comparative figure
~ review the reason for variation
4. A ged list of debtor
~ examine & trace to the debtor ledger to determine whether paid at year end
5. D isclosure
~ ensure appropriate
6. A nalytical review
~ relationship between invoice, trade debtor & creditor & other terms(GP,CA,CL,Debtor day)
7. C ast & total agree to control
8. C ut off procedures for CN
~ verify & ensure

Audit procedure in detrmining adequacy of provision for doubtful debt ( CIA POOR )

1. C onfirmation of debtor
~ verify
2. I ndustry average
~ compare % to them & test them for reasonableness
3. A dequacy for provison for doubtful debt
~ test by axam the experience of poor payment by debtor (each aging category that will become uncollectible)
4. P olicy
~ for credit granting & cash collectible to access
5. O utstanding debtor for a long period for time
~ examine aged listing & test for aging
6. O verall collection
~ review collection in subsequent year
7. R ecover & reversal position to verify