Audit working papers

Jan 22, 2011

Audit Program Cash and bank balances

Audit Program
(i)         Cash and bank balances
WP Ref.:

Prepared by:

Date:

Reviewed by

Date

Client:

Period:

Subject:
Cash and bank balances







Amount in Rs.
Account balances:


Cash in hand


Cash at bank- Current



 - PLS








Classes of transactions:



















S. No.
Audit Objectives
Assertions
Risk Assessment



IR
CR
ROSM
1.
All cash and bank balances are completely and accurately recorded
CA



2.
All recorded cash and bank balances actually exist.
E



3.
All cash and bank balances are recorded at appropriate values.
V



4.
All cash and bank balances recorded are owned by the client and title is also in the name of client.
R



5.
All cash and bank balances are presented and all disclosures have been given in accordance with the Fourth Schedule of the Companies Ordinance, 1984 and relevant IASs.
OCAL
RVU






S. No.
Audit Procedures
Objective
Done by
W. P. Ref.
Test of Controls



1.
Assess the reasonableness of design of system of internal control by enquiring relevant client personnel and documenting the same (if not a documented system manual has been developed by the client). A walk through test would be necessary to confirm the understanding as documented. Identify the preventive (exercised before incurrence of transactions and event) and detective (exercised after incurrence of transactions and event) controls established by management to support its assertions.
ALL


2.
Check on sample of selected transactions covering the whole period that all preventive controls are exercised on all transactions.
ALL


3.
Check on a sample of transactions that detective controls are appropriately been exercised and in case of any detection of error/ fraud, proper steps have been taken to avoid recurrence of the same.
ALL


4.
Check that proper bank reconciliations are prepared, checked and approved. Long outstanding items are followed up and proper disposition of such items is made.
ALL


5.
Proper segregation of duties between custodian and accounting and approving personnel exist.
CE


6.
Payments vouchers are appropriately prepared and properly approved by designated authority.
ECA





S. No.
Audit Procedures
Objective
Done by
W. P. Ref.
7.
Ensure that management does not override the designed controls by
n              Enquiring from the designated staff person
n              Remain skeptical during performing test of design and test of effective operation



8.
Document the conclusion after performing test of controls and required level of assurance from substantive procedures.
N/A







Analytical Procedures



1.
Document logical commercial reasons for new bank accounts opened and closed during the year.
AU


2.
Compare current year balances with last year balances and ensure that any significant variation should be properly and logically reasoned.
CEA







Test of Details



1.
Attend year-end cash count and deposit verification.
E


2.
Circularize direct confirmations to all banks.
ER


3.
Trace opening balance in general ledger from last year working papers.
CE


4.
Obtain and examine bank reconciliations ensure the following: -
n              No long outstanding item should remain unfollowed,
n              No revenue nature item should be appearing
n              All deposit made should be cleared within two days
n              No long outstanding cheques of significant amount are unpresented; if so then check their payment voucher and ensure that no discrepancy is involved.
CEA


5.
Ensure that all balances etc. reported by bank in replies to bank confirmation request are included in records of the client.
CA


6.
Ensure that no balances are subject any encumbrance, if so then disclosure is made.
U


7.
Convert FCY accounts into PKR at year-end rate.
V


8.
Ensure that all bank accounts are in company's name.
R


9.
Ensure that closing balances as per our working paper file are in match with general ledger.
N/A


10.
Determine that disclosures have been made in accordance with the requirements of Fourth Schedule to the Companies Ordinance, 1984 and the applicable IASs.
OCAL
RVU










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