Flashcards in Assertion and Related Control Activity - Revenue Transactions Deck (18)
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1
Occurrence - Sales recorded only with approved customer order and shipping document.
Test a sample of sales invoices for the presence of authorized customer order and shipping document.
2
Occurrence - Accounting for numerical sequences of sales invoices.
Review and test client procedures for accounting for numerical sequence of sales invoices.
3
Occurrence - Monthly customer statements; complaints handled independently.
Review and testing of client procedures for mailing and handling complaints about monthly statements.
4
Completeness - Accounting for numerical sequences of shipping documents and sales invoices.
Review and test client's procedures for accounting for numerical sequence of shipping documents and sales invoices.
5
Completeness - Shipping documents matched to sales invoices.
Tracing of a sample of shipping documents to their respective sales invoices and to the sales journal.
6
Completeness - Sales invoices reconciled to daily sales report.
Testing of a sample of daily reconciliations.
7
Completeness - An open-order file that is maintained currently and reviews periodically.
Examination of the open-order file for unfilled orders.
8
Authorization - Proper procedures for authorizing credit and shipment of goods.
Review of client's procedures for granting credit. Examination of sales orders for evidence of proper credit approval.
9
Authorization - Authorized price list and specified terms of trade.
Comparison of prices and terms on sales invoices to authorized price list and terms of trade.
10
Accuracy - Authorized price list and specified terms of trade.
Comparison of prices and terms on sales invoices to authorized price list and terms of trade.
11
Accuracy - Each sales invoice agreed to shipping document and customer order for product type and quantity; mathematical accuracy of sales invoice verified.
Examination of sales invoice for evidence that client personnel verified mathematical accuracy. Recompilation of the information on a sample of sales invoices.
12
Accuracy - Sales invoices reconciles to daily sales report.
Examination of reconciliation of sales invoices to daily sales report.
13
Accuracy - Daily posting to sales journal reconciled with posting to subsidiary ledger
Examination of reconciliation of entries to sales journal with entries to subsidiary ledger.
14
Accuracy - Subsidiary ledger reconciled to general ledger control account
Review of reconciliation of subsidiary ledger to general ledger control account.
15
Cutoff - All shipping documents forwarded to the billing function daily.
Comparison of the dates on sales invoices with the dates of the relevant shipping documents.
16
Cutoff - Daily billing of goods shipped
Comparison of the dates on sales invoices with the dates they were recorded in the sales journal.
17
Classification - Chart of accounts
Review of sales journal and general ledger for proper classification
18
